Brazil's anti-dumping measures have left European chips processors with a serious tear in the pants. A similar investigation is underway in Colombia. Protecting the local industry (against a European French fries invasion) is infectious in South America, Belgapom has noticed.
The European chip industry is in danger of becoming a victim of protectionist reflexes that threaten international trade, the Belgian potato trade and processing organization Belgapom writes in a press release. Unfortunately, these files also make other South American countries think. However, there are no valid reasons for the anti-dumping measures.
Hard game
The game is played hard. Belgapom calls the Colombian anti-dumping file a cheese in holes, which the European Commission confirms. However, this does not mean that the government will not impose new import duties. A ruling is expected soon. A legal one complaint of European chip processors, against the Brazilian government, is still pending.
Federation EUPPA, the European Potato Processors Association, urges the European Commission to put more pressure on such practices. Even during the investigation, the file is being falsified, it says. The Netherlands is also urging the EC to contact the Colombian authorities to speak on their actions.
Asian growth market
De Belgian fries producers are currently focusing on Southeast Asia. Vietnam, Indonesia, the Philippines, Malaysia and Thailand together account for 557 million consumers and also form a gigantic growth market for fries. The Belgian potato sector receives support for this from the European Commission, among others. In 2018 and 2019, it will carry out a large number of promotional campaigns in Asia to promote fries and the protected 'chip shop culture'.
Effect on export level
Market protectionism can break an export sector. In 2014, South Africa introduced an anti-dumping tax, which caused European exports to fall from 35.000 tonnes per year to less than 12.000 tonnes in 2016. Exports are now recovering slightly, with a volume of more than 14.000 tonnes over the past year.
A different picture is visible in Brazil. There, the level of imported chips grew very quickly, to 346.000 tons in 2016. Despite the anti-dumping tax, which came into effect from February 2017, imports in 2017 amounted to almost 350.000 tons. Producers use European loopholes (such as Poland) for this.
The Netherlands in particular has suffered from the restrictions. The exported volume decreased by 1/6 last year. The Colombian chip market is much smaller compared to neighboring Brazil. The EU-5 exported almost 1 tons to the country in 35.000 year. This means that chip consumption is growing slightly. It is at number 10 in the rankings. Belgium in particular is a major supplier, closely followed by the Netherlands.