The attached article (below), "Ministry probes fruit dumping", details how a 35% anti-dumping duty was imposed on canned apricots from South Africa.
1.Provide an economic definition for dumping
2.Explain, with the aid of an appropriate diagram, why South African apricot growers may want to charge a higher price in their domestic market than in New Zealand.
3.Illustrate the deadweight losses which occur in the New Zealand canned apricot market after the anti-dumping duty has been imposed.
4.Explain who loses and who gains from the anti-dumping duty.
Suppose that there are two meat processing plants located at different points along a north Canterbury river. Both plants emit waste that adversely affects the quality of recreational activities for residents and tourists downstream. The conflict between firms and recreational users can be mitigated in a number of ways. Downstream users can swim at public pools or travel to other recreational sites, but must incur higher costs to do so. Alternatively, firms can purchase equipment which will drastically reduce the impact of their emissions. Compare and contrast the following options for dealing with the harmful effect of the waste, using diagrams to illustrate your answer:
1.An emission standard that is equal across producers.
2.An emission fee that is equal across producers.
3.A subsidy on emission activities.
4.A transferable emission permit system.
5.An allocation of property rights to the downstream users such that downstream users have the right to clean water.
Explain how measures of protection can be used to evaluate the recent agricultural policy changes in the European Union. Are the values for these measures of protection likely to change in the future? What impact do reforms of European agricultural policy have on New Zealand agricultural producers?
THE EVENING POST, 24 AUG 1996, Edition 3, Page 19. Ministry probes fruit dumping By: SCHOUTEN Hank
Anti-dumping duties have been imposed on South African peaches and the Ministry of Commerce is investigating a complaint apricots are also being sold on the New Zealand market at unfair prices. The Ministry may also impose additional duties to counter the effects of export subsidies offered by South African manufacturers.
Hugh McPhail, manager of the Ministry's trade remedies group, said about 550 tons of South Africa peaches were imported last year. The total market for canned peaches is about 5000 tons a year. An investigation, mounted following a complaint from Watties, found that the peaches were being sold for about 20 percent less than their value in South Africa. However, imports of cheap canned apricots from South Africa have badly hurt the small South Island apricot industry and Watties have been cited as one of the importers.
Roxdale Foods managing director Hamish Dowell said Roxdale had lost a lot of market share. Growers, who reported a bumper harvest last season, were unable to get much of their non-export crop processed and were forced to sell fruit on the local market for less than their production costs.
It is alleged that standard 410g cans of South African apricots can be bought in New Zealand for about 65c a can, 30c to 40c less than they are sold for on the South African market. This is about half the price of locally canned apricots. Last month Commerce Minister John Luxton imposed an interim duty of 35 percent on South African apricots pending a full inquiry.
Guy Wills, business group manager of J Watties Foods, said Watties wanted to ensure the market was fair. He said allegations of apricot dumping were not yet proven, and Watties had purchased supplies from South Africa because they met its quality standards, reliability of supply and price requirements. The company had now reverted to buying New Zealand apricots.