Pasta – one of the most inexpensive foods enjoyed by American consumers – could become prohibitively expensive under a new initiative by the U.S. Department of Commerce. The move comes after Italian companies La Molisana and Garofalo (Pastificio Lucio Garofalo S.p.A) – the two largest Italian pasta exporters – were investigated by the Commerce Department for dumping between July 1, 2023 and June 30, 2024.
Dumping is defined as when a company sells its products overseas for a price lower than what it charges in its home market. The practice is frowned upon by the U.S. government, which argues it is predatory to domestic producers. According to a an administrative review published in September, the weighted-average dumping margin by the two companies investigated was 91.74%. The figure is calculated as (Home price – Export price) / Export price.
Companies Under Investigation
In addition to La Molisana and Pasta Garofalo, the federal government is reviewing sales information from the following companies: Agritalia, Aldino, Antiche Tradizioni di Gragnano, Barilla, Grupo Milo, Pastificio Artigiano Cav. Giuseppe Cocco, Pasta Rummo, Pastificio Chiavenna, Pastificio Liguori, Pastificio Sgambaro and Pastificio Tamma.
The the anti-dumping duty would add an additional 91.74% anti-dumping duty to an existing 15% tariff on European goods, creating a 106.7% total tax for the above-named companies starting in January. Historically, such charges are passed onto consumers – in this case, American households and U.S. restaurants including pizzerias.
However, a spokesperson for Rummo USA tells the New York Post the company would “try to absorb it,” even as the tariff could push prices from $3.99 per box to $7.99. Meanwhile, companies targeted by the U.S. government might have to pay retroactive tariffs for up to two years, if the proposed tariffs are enacted the spokesperson added.
Other Italian pasta producers say such a surcharge would force them to stop selling their products in the United States. In turn, this could give domestic producers the ability to raise their own prices, since they would have fewer competitors.
Lack of Domestic Product
Food analysts tell CBS News there currently is not enough U.S.-made pasta to cover the shortfall, should Italian food distributors discontinue shipping products to the United States. While some Italian pasta companies say they could pull products from U.S. shelves as soon as soon a January, the investigation into the remaining companies is not yet complete, and the proposed tariffs are preliminary.
The United States is the world’s fifth-largest exporter of wheat, the primary ingredient in most pastas, according to recent data from the U.S. Farm Bureau. Meanwhile, the European Union is the seventh-largest importer of U.S. wheat, purchasing more than 3.5% of U.S. exports.
According to the U.S. Department of Agriculture, reduced domestic use for wheat is expected to be offset by higher exports – although that likely does not account for new tariffs on imported wheat products.
