The New Zealand government will formally investigate the possible French fries dump through Europe. Although the result may take another six months, the potato industry in the country is pleased.
Trade association Potatoes New Zealand (PNZ) announced at the end of May emergency bell. There was, as in Australia, great fear that cheap fries from Europe would disrupt the internal market. This mainly concerns frozen potato products from the Netherlands and Belgium. Dumping of these products would lead to price drops from 18% to 38% for the New Zealand potato industry. Growers and processors therefore urged the government to impose import restrictions.
Sufficient reason
In September, PNZ submitted an official application to the government. The Ministry of Business, Innovation and Employment sees sufficient reason to launch a formal investigation into the matter. According to the ministry, the industry has provided sufficient evidence that average selling prices in New Zealand have come under pressure.
According to news site Stuff, the ministry has established that Belgium and the Netherlands together exported 6 tons of fries to New Zealand in the first 2.076 months of this year. That is more than half of the total exports in the previous year (4.040 tons). However, it is still far from the more than 50% increase in exports that PNZ is talking about.
Further price drops
However, there are fears that the disruption of the internal market will only increase. For example, PNZ writes on its website: 'At the time of the application, the French fries surplus in Europe was 1,5 million tons. It is now estimated at 2,6 million tons and the stock is growing by the minute due to new lockdowns in parts of Europe.' The New Zealand industry will also experience price declines over the next 12 months, according to PNZ.
The trade organization feels supported by similar situations in other countries. Australia and the United States, among others, have called for measures to limit the import of European fries. Following this, the potato industry in South Africa also requested the government at the beginning of September for a temporary import stop.
Roman Cools
Impending chip war
In the meantime, Belgium and the Netherlands are watching developments abroad with great care. "New Zealand is not a large sales market, but the impending import restrictions could also encourage other countries to take such measures," says Romain Cools, secretary of Belgapom. At the same time, he calls the New Zealand dossier particularly colored, arising from protectionist thoughts. His 'colleague' Hylke Brunt from the Dutch potato processing industry (Vavi) previously announced that it is all hands on deck. The chip war threatens to spread like an oil slick across the world stage.
Regarding the situation in New Zealand, it may take some time before it is clear whether the government will implement import measures. It may take up to 6 months for the ministry to complete the investigation. This will be followed by a 3-month follow-up investigation to determine whether any import restrictions are in the public interest. Moreover, Cools is hopeful that it will not come to that. "New Zealand is a developed and exporting country. We hope that the government realizes that any import restrictions are self-defeating."