Congressman Faleomavaega announced today that on May 14, 2004 Senator Daniel Inouye (D-HI) and Senator Ted Stevens (R-AK) joined with him in signing a letter to the Honorable Bill T. Hawks, Under Secretary for Marketing and Regulatory Programs, at the U.S. Department of Agriculture (USDA) regarding country of origin labeling (COOL) requirements for canned and pouched tuna. Congressman Randy “Duke” Cunningham (R-CA) also lent his support.
“By September 30, 2004 and as a result of the FY04 Omnibus spending bill which amended the 2002 U.S. Farm Bill, the USDA will require country of origin labeling for the retail sale of canned and pouched tuna,” Congressman Faleomavaega said. “This will impact American Samoa’s tuna canneries and this is why I am pleased that Senator Inouye, Senator Stevens and Congressman Cunningham have agreed to support my efforts to resolve this matter in a way that is fair to American Samoa, including the U.S. tuna boat owners and StarKist and Chicken of the Sea.”
“This is why I have also brought this matter to the attention of the Governor and our local leaders in a letter dated May 26, 2004. In my letter, I explained that the rules, as currently written, would negatively impact the economy of American Samoa which is more than 80% dependent either directly or indirectly on the U.S. tuna fishing fleet and two United States tuna canneries, namely Chicken of the Sea/Samoa Packing and StarKist.”
“The U.S. tuna boat owners supply 70% of whole fish used in American Samoa’s canneries and contribute over $25 million annually to the Territory’s economy. StarKist and Chicken of the Sea/Samoa Packing employ more than 5,150 people or 74 percent of the workforce. The loss of the U.S. tuna fishing fleet or a decrease in production or departure of one or both of the two U.S. canneries in American Samoa could devastate the local economy resulting in massive unemployment and insurmountable financial difficulties,” Congressman Faleomavaega said.
“Under the COOL rules as currently written, for a can or pouch of tuna to bear a ‘Product of the U.S.A.’ label, the tuna must be caught by a U.S. flagship and processed in the United States or its Territories. If the tuna is caught by a foreign flag ship or substantially transformed and cooked and cleaned in a foreign country, then the label must inform consumers accordingly.”
“However, tuna is a highly migratory species and is caught in international waters by the U.S. tuna fishing fleet and vessels from more than 23 nations. Most of this tuna is offloaded and cooked and cleaned in American Samoa by Chicken of the Sea and StarKist in compliance with U.S. law.”
“Because of the number of foreign vessels offloading fish in American Samoa, implementing the COOL program will require StarKist and Chicken of the Sea to use multiple labels and sort fish prior to processing in ways that would be cost prohibitive. Neither Chicken of the Sea nor StarKist can implement flag ship requirements and remain competitive,” Congressman Faleomavaega said.
“Given the adverse consequences added costs for implementing the COOL regulations may have on American Samoa’s canneries, I made a proposal to the U.S. tuna industry and solicited support from Senator Stevens and Senator Inouye. We have requested that the USDA consider defining tuna packed in American Samoa and made with 70% whole fish and no more than 30% precooked loins as a processed food item exempt from COOL regulations. This ratio assures that the bulk of fish is cooked and cleaned by workers in American Samoa according to U.S. standards and law.”
“As further support for our position, we noted that U.S. tuna canneries operate on one of two premises. A cannery either mixes whole fish and precooked loins. Or, a cannery uses 100% precooked loins meaning the fish is cooked and cleaned in a foreign location. No U.S. cannery uses 100% whole fish. In the case of American Samoa, both Chicken of the Sea and StarKist operate off of premise one, mixing less than 30% precooked loins annually when whole fish supplies run short.”
“On the other hand, Bumble Bee, located in California and Puerto Rico, uses 100% precooked loins meaning the fish is substantially transformed or cooked and cleaned in a foreign location at a wage rate of less than $0.60 per hour,” Congressman Faleomavaega said. “As currently written, USDA rules would require Bumble Bee to create a label for each and every foreign location where the tuna was cooked and cleaned. This could require Bumble Bee to print up to six different labels and segregate its loads accordingly which again would be cost prohibitive.”
“Therefore, we have asked that the USDA issue a rule that allows Bumble Bee to print on its label ‘Product of: See Can’ and stamp on the end of its can the location of the country where the fish was substantially transformed. This would satisfy the intent of the COOL program and would also simplify the labeling process for Bumble Bee which supports this proposal, for the time being.”
“We have also asked that this same rule apply to any U.S. cannery that switches production from a 70-30 annual mix. In other words, any cannery that does not meet the definition of a processed food as defined as annual production of 70% whole fish and no more than 30% precooked loins would be required to label its precooked loins according to the guidelines established for Bumble Bee. By making these distinctions between a) fish cooked and cleaned in a foreign location at a wage rate of $0.60 and less per hour and b) fish supplied by the U.S. tuna fishing fleet and cooked and cleaned in American Samoa at a wage rate of $3.60 per hour, the U.S. tuna fishing fleet and the jobs of more than 5,100 workers in American Samoa will be protected,” Faleomavaega said.
“As I have indicated in my letter to the Governor, the U.S. tuna industry including Chicken of the Sea/Samoa Packing, StarKist, the U.S. tuna boat owners and Bumble Bee currently support this issue. However, I have also informed the Governor and our local leaders that at a later time Bumble Bee and StarKist may resist this proposal and attempt to find a legislative fix that exempts them from COOL regulations no matter how many precooked loins they use on an annual basis.”
“I have informed all parties that I will not support a ‘Product of the U.S.A.’ label for tuna cooked and cleaned in a foreign country or for canneries in American Samoa that exceed an annual use of 30% loins. The production of loins, including the butchering and cleaning steps, accounts for up to 80% of the cost of labor in a full-scale cannery. This means that if a cannery buys loins instead of whole fish it can substantially reduce its labor costs. In other words, more loins mean less labor. Less labor means downsizing and downsizing means many of our cannery workers will be out of jobs if StarKist and Chicken of the Sea/Samoa Packing continue to ship loins into American Samoa.”
“Our U.S. tuna boat owners are also at risk as a result of this trend. The U.S. tuna fishing fleet contributes more than $25 million per year to American Samoa’s economy and supplies 70% of the tuna processed in our canneries. On the other hand, precooked fish that has been cooked and cleaned in a foreign location and offloaded in American Samoa by foreign vessels is contributing little to our economy,” Congressman Faleomavaega said.
“It is a well known fact that StarKist and Chicken of the Sea are sending precooked loins into our Territory to save labor costs. Both canneries have to pay our workers on average $3.60 an hour to cook and clean fish while workers in Thailand and the Marshall Islands do this work for less than $1.50 per hour. A new FCF plant, soon to open in Papua New Guinea and owned by a foreign group including Taiwanese, European and U.S. investors, will pay workers even less to cook and clean fish and these precooked fish (loins) will also be sent to American Samoa where, again, our Territory will receive little compensation. Our workers will not be paid to cook and clean the fish and our small business owners will see no revenues like the ones brought in from the U.S. tuna boat owners who purchase supplies, gasoline, etc. when offloading whole fish in the Territory.”
“While I understand the need for our canneries to reduce costs, I cannot and will not support an increase in precooked loins being shipped from foreign countries into American Samoa for use in our canneries. This trend must stop or American Samoa must be compensated for revenue lost as a result of this backdoor attempt to reduce our labor force, suppress our wages, and allow foreign countries to send their tuna into the U.S. exempt from duty. Again, for the sake of American Samoa, I will not support an exemption for any cannery that uses more than 30% precooked loins and I am hopeful that our local Territorial government will also take a strong stand on this issue which will affect the economy of American Samoa for generations to come,” the Congressman concluded.