Italian Pasta Companies Challenge Proposed Tariffs
One of 13 Italian pasta firms facing a staggering 107% tariff set to take effect in January is urging the Trump administration to reconsider the plan, which could necessitate a price increase of nearly double.
An executive from the U.S. arm of the Italian pasta giant Lumo shared with the Post that, without raising prices (from $3.99 to potentially $7.99), their products may not even last a month or two. This is particularly concerning since affected companies will have to cover retroactive tariffs for the past two years.
“We’re going to attempt to absorb that,” said Jim Donnelly, chief commercial officer at Rummo USA, adding, “We’ll try to hold out for as long as we can.”
Donnelly mentioned, “If any reasonable person looked into this, they’d see Lumo shouldn’t be charged like this. I think it’s a major mistake.”
The Ministry of Commerce has announced that, in addition to a 15% tariff on EU products, a significant 92% anti-dumping duty will apply to 13 prominent Italian pasta exporters starting January.
Brand representatives have cautioned that the proposed tariffs could lead to their products disappearing from U.S. grocery store shelves altogether.
This punitive measure was initiated after the Commerce Department sought details from two well-known brands, Pasta Garofalo and La Morisana, amidst an inquiry into alleged “anti-dumping” practices.
Italian pasta exporters often face accusations of “dumping,” or saturating the U.S. market with lower-priced pasta to undermine local competition.
Federal officials have accused the 13 companies of being “uncooperative” (for supposedly submitting documents that were untranslated), which resulted in higher tariffs than those typically assigned.
White House press secretary Khush Desai remarked that these Italian pasta producers have hindered a straightforward data request vital for ongoing anti-dumping reviews initiated long ago, in 1996.
He further indicated that these companies have several months to engage in the review process and challenge the tentative 92% tax rate.
Donnelly stated that Lumo wasn’t even granted a chance to provide its documentation for review. “That’s absurd. I only learned of this through some information I found online,” he said. Rummo USA employs Americans in a warehouse based in New Jersey.
The new tax is projected to impact about half of Italy’s $780 million pasta exports to the U.S., especially hitting pricey brands, according to Luigi Scordamaria, CEO of the Italian food trade group Filiella Italia.
Donnelly feels the 92% tariff is excessive and far above the usual anti-dumping duty, which hovers around 15%. “Honestly, I believe that by February, someone will look back and think, ‘Wow, that was a mistake,’” he told the Post.
“Our aim is to offer the world’s best pasta without burdening consumers financially.”
Typically, anti-dumping duties penalize companies selling goods at prices lower than what they charge domestically, often below production costs.
Donnelly claimed Lumo was actually selling pasta at three times the price it commands in Italy. “We shouldn’t be penalized for anti-dumping; rather, we should be commended,” he stated.
There are also worries that these new tariffs could adversely affect American farmers since the U.S. is a crucial exporter of durum wheat, a vital ingredient in high-quality pasta.
According to World Integrated Trade Solutions, Italy exported around 155,124 tonnes (36% of total durum wheat exports) in 2021, valued at about $50 million.
Donnelly noted that most Italian pasta manufacturers source their durum wheat from Italy, while Rummo obtains a significant part of its supply from there, with smaller amounts from Arizona and Australia.
