Impacts of the Andean Trade Preference Act on Asparagus Producers and Consumers
GAO-01-315, Mar 15, 2001
U.S. asparagus imports increased in the 1990s and now comprise nearly one-half of the asparagus consumed in the United States. Peru is the second largest source of imported asparagus and benefits from duty-free treatment under the Andean Trade Preference Act (ATPA). ATPA is estimated to have displaced between two and eight percent of the value of domestic production from what it would have been without the act. Although the supply of fresh asparagus from imports has increased since ATPA's enactment, consumer demand has been strong, and prices have risen. In addition, an apparent increase in consumer preference for fresh asparagus has contributed to a downward shift in the domestic demand for processed asparagus. Most of the decline in the domestic production of processed asparagus occurred in Michigan and Washington, the two states that produce most canned and frozen asparagus. If ATPA is reauthorized, domestic producers of asparagus and, in particular, asparagus for processing, will likely face continued displacement, but consumers can expect continued benefits from the year-round availability of fresh asparagus. However, some of this displacement will likely occur even if ATPA is not reauthorized and the normal tariff is imposed. If ATPA is not reauthorized, consumers would likely have decreased availability and pay higher prices to the extent that tariff increases reduce Peruvian asparagus imports and hence total asparagus supplies. Domestic industries can petition the U.S. International Trade Commission to investigate whether increased imports under the ATPA have caused them serious injury or threat of serious injury. If the Commission finds serious injury, it may recommend relief options to the President, including suspending duty-free treatment for imports.