What Is Dumping Duty?

Team Shipmate

What Is Dumping Duty

In the world of international trade, "dumping" occurs when a company exports a product to another country at a price that is lower than the price of the same product in the domestic market. To protect domestic industries from being undercut by foreign competition, many countries impose so-called "dumping duties" on these products. In this blog post, we'll take a closer look at what dumping duties are and how they work. Stay tuned!

black sail ship on body of water
Photo by Albin Berlin on Pexels.com

What Is Dumping Duty

Dumping duty is a tariff designed to protect domestic goods by preventing imports from being sold at an unfairly low price. When an imported product undercuts the price of similar products in the domestic market, dumping duty is applied to protect producers from low cost competition and protect jobs in the local economy. This ultimately helps protect businesses from unfair competition and ensures that all companies are able to operate on a level playing field. Therefore, by setting dumping duties, governments can protect their countries' businesses and economies.

white house
Photo by Aaron Kittredge on Pexels.com

Purpose Of Dumping Duty

Dumping duty is protectionism for domestic industries, designed to prevent foreign competitors from encroaching on their business. By imposing a tariff on imported goods, dumping duty seeks to maintain the production of domestic industry in order that it can remain competitive in the global market. Dumping duty allow governments to keep production vibrant within their own borders and protect employment, while also allowing companies to keep consumers loyal by keeping prices lower than those set by foreign competitors. Ultimately, protectionism through dumping duty seeks to preserve and create local jobs while preventing foreign competition from taking away these opportunities.

cars parked in front of company building
Photo by Craig Adderley on Pexels.com

How Is Dumping Duty Calculated?

In international trade, dumping duty calculation has a unique purpose and calculation system. By measuring the difference between the actual selling price of an imported good and its fair value, the calculation determines whether or not protectionism is needed to reduce the cost of goods being imported. This calculation helps protect domestic manufacturers by imposing additional tariffs on goods that are being sold at low cost abroad but could still be competitive in the country's own market. All in all, this calculation is an important part of international trade, as it ensures fairness for both domestic manufacturers and foreign goods entering the market.

scientific calculator on wooden surface
Photo by Pixabay on Pexels.com

Examples Of Items Subject To Dumping Duty

When it comes to items subject to dumping duty, the list is quite varied. This type of dumping duty is a tariff on imported goods which are sold at prices below the cost of production. Some specific examples of items that may be subject to dumping duties include steel, aluminum, paper and wood products, seafood, textiles and apparel, chemicals, nuts and seeds, and some tech products. By imposing dumping duties on these items when they are imported into a country, governments are attempting to protect their own producers from market disruption due to foreign competitors pricing their products below what local industry is able to do. Therefore dumping duties help to promote fair trade while also protecting local businesses.

man wearing welding helmet welding metal near gray brick wall
Photo by Movidagrafica Barcelona on Pexels.com


Dumping duty is a tariff that is imposed on imported goods that are sold at less than fair value. The purpose of dumping duty is to protect domestic industries from being harmed by foreign competition. Dumping duty is calculated based on the difference between the selling price of the imported good and the fair value of the good. If the selling price of the imported good is lower than the fair value, then a dumping duty will be imposed on the import. The amount of dumping duty imposed depends on the degree to which the selling price of the imported good is below fair value. Dumping duty can be applied to any type of product, including but not limited agricultural products, manufactured goods, and services. Have you experienced dumping duty?

More Recent Stories