Peru's Piura cotton growers seek compensation from govt

19 Aug '13

1 min read

The association of cotton producers of Piura region, located in northwestern Peru, has appealed for allocation of compensation to counter the unfair competition faced by local producers due to subsidized imports of cotton from US.

Cesar Zapata Alzamora, president of the cotton producers association of Piura, said it was important to seek compensation for the domestic cotton producers, reports LaRepublica.

The National Association of Cotton Producers (ANPAL) in Peru, along with the other non-governmental organizations, has filed an appeal before the Commission of Antidumping and Subsidies (CFD) of the National Institute of Defense of Competition and Intellectual Property Protection (INDECOPI) for giving compensation to local farmers, he added.

Mr. Alzamora explained that American cotton continuously enters the country at subsidized value or undercut prices because the US Government supports its farmers with direct payments and subsidized credit for marketing and exports of cotton.

The US subsidy policy creates a distortion in the price paid by textile traders to Peruvian producers which has resulted in lower production of Peruvian cotton.

Earlier this month, INDECOPI suggested an imposition of 10 percent countervailing duty on the imports of US cotton, based on its investigations conducted in 2012.

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