previously been imported, is reportedly destined for processing into. cheese foods or cheese spreads. The reported unit value averaged

about 15 cents per pound.

Much

In recent years an increase in imports of the "other" cheese has been notable from West Germany, Sweden, Poland, and Finland, although these countries have not traditionally been large suppliers. of the imports from West Germany has consisted of Mozzarella, a cheese not important in international trade until recently. A witness at the hearing testified that the duty-paid cost of the West German cheese was 32 cents per pound delivered to his warehouse at New York City; 1/ the cost of the comparable domestic cheese is 46 to 47 cents per pound. 2/ The low unit value of the imports from Sweden, Poland, and Finland (tables 20 and 21) indicates that some of this cheese may be imported for processing.

The

Many trade sources testified at the hearing that imports of the "other" cheese, particularly that imported for sale at retail as natural cheese, have not increased significantly in recent years. imports of natural Gruyere from Switzerland, for example, increased gradually from 136,000 to 241,000 pounds during the period 1964-67. 3/ Imports of Bel Paese cheese from Italy increased from 249,000 to 259,000 pounds during 1964-67. 4/ The imports from Norway, consisting largely of varieties (goats' milk cheese) not made in the United States, increased from 980,000 pounds in 1964 to 1.5 million in

1/ Transcript of hearing, p. 265. 2/ Ibid., p. 269.

3/ Statement submitted on behalf of the Embassy of Switzerland, p. 30. /Statement submitted by Bel Paese Sales, Inc., New York, New York.

1967. 1/ The witness for the Department of Agriculture testified at the hearing that with respect to "other" cheeses "The Department is not seeking the exclusion or any avoidable restriction on the high quality table cheeses. It is the cheap, processing-use cheeses and processed cheeses that must be brought under control. . . ." 2/

1/ Statement submitted on behalf of the importers of Norwegian cheese and the Norwegian Chamber of Commerce, appendix C. 2/ Transcript of hearing, p. 28.

Swiss or Emmenthaler Cheese with Eye Formation

Swiss cheese with eye formation is a hard, natural cheese made

from cows milk; it is distinguished by the large holes, or eyes, which are developed by the action of certain bacteria. 1/ Swiss cheese was first made in the valley of the Alpine Emme River and hence, is called Emmenthal or Emmenthaler. Substitutes for cheese containing

or processed from Swiss or Emmenthaler, although included with that cheese to avoid circumvention of any restrictions, are not known to have been imported. 2/ So-called "grinders" Swiss cheese is natural cheese that has developed imperfections, generally in the eye formation, while being produced. 3/ Grinders Swiss is lower priced than either the domestic or imported cheese sold at retail as natural Swiss cheese. It is not marketed as natural cheese for table use, but rather is processed and sold at the retail level as pasteurized process Swiss. cheese or used as an ingredient in cheese foods or cheese spreads.

In recent years a large part of the domestic Swiss cheese has been made by a patented process in the form of 80-100 pound rectangular blocks which are sealed in plastic and often called "rindless

When

1/ Imported Swiss cheese without eye formation, i.e., process Swiss cheese, is dutiable in the tariff provisions for "other" cheese. Swiss cheese and natural Gruyere are processed together, however, the resulting product, if containing sufficient quantities of natural Gruyere (about 25 percent) is classified in the tariff provision for Gruyere-process cheese.

2/ If imported they would be included with "other" cheese, covered in a previous section of this report.

3/ Statement submitted on behalf of the Embassy of Switzerland, p. 3, and statement submitted on behalf of the United States Austrian Chamber of Commerce, p. 3.

4/ Transcript of hearing, p. 31.

Swiss."

Swiss cheese in the form of blocks is better suited to conventional chainstore marketing than that in wheels, the traditional form; the wheels are difficult to slice because of their heavy rind and hard to cut into uniform sizes because of their shape. Swiss is produced only in the United States.

Rindless

U.S. customs treatment

The rate of duty currently applicable to imports of Swiss or Emmenthaler cheese from countries other than those designated as

being under Communist control, is as follows:

TSUS item

Rate of duty

Commodity

117.60 (pt.) Swiss or Emmenthaler cheese with eye formation.

14% ad val.

This rate of duty, which became effective January 1, 1968, is the first stage of a concession granted by the United States in the sixth (Kennedy) round of trade negotiations under the General Agreement on Tariffs and Trade. The rate of duty will be further reduced in 4 annual stages to 8 percent ad valorem.

Presidential Proclamation No. 3870, dated September 24, 1968, imposed an emergency quota on imports of Swiss or Emmenthaler cheese with eye formation if shipped otherwise than in pursuance to a purchase, or if having a purchase price (as provided in the proclamation) of less than 47 cents per pound.

The following tabulation

chows the quota and the allocation for the remainder of 1968 and

1/ Imports for 1968 are limited to the amounts shown above plus the quantities entered on or before Sept. 24, 1968; however, the quotas are not applicable to quantities exported to the United States, but not entered, prior to Sept. 24, 1968, to the extent that such quantities are in excess of the quotas.

The emergency quota will remain effective pending the findings and recommendations of the Tariff Commission and action thereon by

the President.

U.S. consumption

U.S. consumption of Swiss cheese increased annually from 129 million pounds in 1963 to 148 million in 1967 (table 22). The increase is attributable largely to the popularity of cheese sandwiches and to promotional efforts of producers and distributors both of the domestic and imported cheese.