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Florida Citrus Mutual Dumping Statement

We had data showing that Brazilian processors were purchasing fruit during the season at prices that would generate significant losses on that fruit given the prices at which they were selling FCOJ on the world market. These additional fruit purchases at a loss added to an already oversupplied market for FCOJ that season (2003-04).

Also, Brazilian processors made not one but several deliveries of juice into the FCOJ futures market at prices well below the cost of production for just the fruit not including the cost of processing and shipping FCOJ overseas. These highly visible transactions put substantial additional downward pressure on futures prices. Since movements in futures prices and fruit prices are highly correlated, fruit prices for Florida growers were also pressured downwards pushing many Florida groves into the red that season.

As for Brazilian processors in Florida, this additional downward pressure on prices allowed them to buy Florida fruit at substantially lower prices than if Brazilian FCOJ had been fairly priced at levels that at least covered costs of production.

Using the dumping margins calculated by the US Dept. of Commerce, we have estimated that dumping reduced Florida farm-gate revenues by about 9% or $70 million. Based on our investigation and examination of the data, we believe that the actual loss may have actually been $100 million or more.

We would like to clear up a common misconception that the Anti-Dumping Order has imposed non-refundable “retaliatory” or “punitive tariffs” on Brazilian processors. This is incorrect. The AD order requires that certain Brazilian processing companies must post a deposit with the US government on any juice that is imported into the US. The US government will annually review the activities and sales by these processors into the US and if the annual review shows no dumping by that company during the year, their deposits will be refunded in full with interest. If the review determines that dumping did occur, then the company forfeits the deposits. The AD order against a particular company and the requirement to post deposits will be lifted when the company successfully completes three consecutive reviews with no findings of dumping by that company. Basically, it is up to the Brazilian processing company as to whether the AD order will cost them anything or not. All they have to do is not dump product into the US market. The AD order includes no punishment or payment for the losses that Florida growers incurred, rather, the AD order is a forward looking safeguard designed to discourage such behavior in the future.