U.S. Shrimpers Sink on Flood of Imports

Craig Wallis’ son had a college diploma and an earnest intention when he approached his father two years ago.

He wanted to work for the family firm, W&W; Dock, which manages a fleet of 15 shrimp boats. In this peaceful waterside town in southeast Texas, where laundry dries on clotheslines near the main drag, shrimping has long been a source of pride and prosperity.

“I told him no,” recalled Wallis, 51. “He can’t fight this battle.”

The son went on to become an engineer at Exxon Mobil Corp. while his father struggled to balance the books at W&W.;

In December, Wallis laid off 35 of 60 workers and dropped insurance on six boats. Then he went to Washington and testified before the U.S. International Trade Commission, to which he and dozens of other shrimpers have filed a complaint alleging that the United States has become a dumping ground for cheap, drug-laden pond-raised imports.

The case, in which the trade commission is expected to issue a preliminary ruling Tuesday, has stoked a long-simmering debate about the acceptable amount of an antibiotic called chloramphenicol in the shrimp Americans eat. The United States has banned chloramphenicol in any food, but more than 85% of the shrimp consumed in this country is imported and the Food and Drug Administration is able to inspect only a small fraction of it.

“If an antibiotic is banned for use in domestic shrimp, then it shouldn’t be allowed for imports,” said Caroline Smith DeWaal, food safety director at the Center for Science in the Public Interest, a nonprofit consumer advocacy group. “A lot of shrimp could be coming in today that could have illegal antibiotic residues, and nobody’s really checking it.”

The questions about shrimp are being raised as consumers grapple with a host of food safety issues, alarmed by reports of mad cow disease in beef, avian flu in poultry and toxic chemicals such as polychlorinated biphenyls, or PCBs, in farmed salmon.

But for the shrimp industry in this country, the worry isn’t about health; it’s about business.

The dumping complaint was filed by the Southern Shrimp Alliance, a group of fishermen, dock owners and processors that claim that low-cost shrimp farmers in Vietnam, India, Brazil, China, Thailand and Ecuador are injuring U.S. producers by unlawfully pushing down shrimp values.

Wallis, a member of the alliance, said he sold a pound of shrimp for an average $5.90 in 2000 and for an average $3.18 last year. The price drop is being seen industrywide in the United States, said Wilma Anderson, executive director of the Texas Shrimp Assn. The trade group said dockside prices for shrimp had fallen to 40-year lows.

“It’s been occurring since 2001, since foreign shrimp has been dumped on our market,” Anderson said.

The alliance claims that shrimp farmers in Asia and South America began unloading their supplies on the U.S. market after the European Union in 2001 cracked down on imports over chloramphenicol worries and Japan strengthened its health requirements for shrimp.

Chloramphenicol is a powerful drug physicians prescribe for meningitis after other antibiotics have failed. It has the potential to cause leukemia or trigger fatal aplastic anemia, a condition that destroys the immune response by diminishing the bone marrow’s ability to produce blood cells.

In the Far East and South America, some shrimp farmers treat their ponds with chloramphenicol so that fecal matter left from past generations doesn’t ruin the current harvest.

The FDA has declared a zero tolerance for chloramphenicol and performs spot checks for it in crabmeat, shrimp and crawfish. But critics complain that zero tolerance doesn’t mean much in the face of an understaffed government screening program. There are about 900 FDA agents inspecting all the seafood coming into the United States. And in 2003, the U.S. imported more than $10 billion of shellfish, according to the Department of Commerce.

The FDA declined to comment on the criticism. The agency routinely discovers harmful levels of antibiotics in imported farmed shrimp and detains those loads, a spokesman said. In November 2003, for example, inspectors stopped shipments of frozen shrimp from China, Brazil and Indonesia that had what the spokesman said were detectable levels of drug residue. This month, FDA records show, a load from Peru was detained for the same reason.

Whole Foods Market Inc., which has 37 stores in California, pays a third-party inspector to examine the shrimp it imports from China because it doesn’t want to rely on federal agents, said Dick Jones, the company’s national seafood buyer.

The Austin, Texas-based chain buys only from shrimp farms that claim to use organic methods, he said, though organic standards differ from country to country. And people who shop at Whole Foods can’t be sure they are avoiding antibiotic-laced shellfish.

The company puts labels on its shrimp that include the terms “wild,” “farm-raised,” “fresh” or “previously frozen,” Jones said, but “not necessarily the country of origin of the product.”

A good bet, some food safety advocates say, is to choose shrimp netted in U.S. waters, not farmed abroad. But that requires consumers to take the time to ask about the shrimp’s origins and grocery or restaurant staff to be knowledgeable enough to know.

Wally Stevens, president of the American Seafood Distributors Assn., a trade group defending the six countries named in the International Trade Commission complaint, said domestic shrimpers should not blame foreign shrimp farmers for their problems.

“The answer is not in filing a dumping lawsuit,” he said. “They need to do some marketing.” U.S. shrimpers are “missing one heck of an opportunity to capitalize on the uniqueness” of their caught-in-the-wild product.

If the ITC and the Commerce Department rule in favor of the Southern Shrimp Alliance, the government could decide to impose levies on imported shrimp.

In Palacios, people are hoping for that outcome, even though it won’t eradicate chloramphenicol in the frozen shrimp arriving each day at harbors in New York and San Francisco. Here, row upon row of 80- and 90-foot shrimp boats are tied to the docks, idled by fuel costs that have gyrated wildly in the last three years; diesel costs 8% more than it did in 2001. Many of the boats, which cost about $500,000 each, have been repossessed by lenders.

Local fleet owner David Aparicio said foreign competition was threatening to wipe out a trade typically handed down from generation to generation.

As it is, he said, “we can barely afford to harvest this crop.”