On Thursday, November 21, Western Growers and nearly 15 of its specialty crop allies sent a letter to the U.S. Trade Representative, urging Ambassador Robert Lighthizer to secure the elimination of China’s retaliatory tariffs on fresh fruit, vegetables, and tree nuts. The letter was also sent to U.S. Department of Agriculture (USDA) trade officials, as well as the Chairs and Ranking Members of the House Committees on Agriculture and Ways & Means.
Since last year, the United States and China have been entangled in a protracted trade war, with both sides levying tariffs against each other’s exports. For specialty crops, virtually every type of product has been hit by China with a tariff increase of 30-50%. For commodities like tree nuts and certain fresh fruits, the tariffs have been especially damaging to the industry, with exports dropping off and foreign competitors moving into the market space. Overall, U.S. agricultural exports to China have significantly declined, topping out at $9 billion in 2018 – a drastic drop from the industry’s peak at $24 billion in 2014.
Negotiations between the United States and China to end the trade conflict have been ongoing since late last year, oscillating between ‘hot’ and ‘cold’. Per the most recent public statements, both parties have being working towards a ‘phase one’ deal by the end of the year, which is expected to address agriculture and the tariffs; the exact scope of what issues will be addressed, and which crops will be included, remains unknown. With much national attention being paid to the trade impact on program crops and livestock, Western Growers and the other signatories continue to proactively elevate the impact our own industry has faced, demanding that specialty crops not be left out in any deals with China.
The industry letter expresses the urgent need for USTR and the Administration to demand from China that retaliatory tariffs be lifted off specialty crops. The letter also highlights other important export issues that will need to be addressed in future negotiations with China, as certain other crops like strawberries require more than retaliatory tariff removal to truly penetrate the market. This includes reductions or eliminations of certain pre-retaliation tariff rates, as well as improvements to China’s sanitary-phytosanitary (SPS) regime, which can be notoriously difficult to navigate and has repeatedly blocked several U.S. commodities from the country.
Western Growers continues to follow the progress of the negotiations closely and reiterate our industry’s needs to USTR, USDA, and Congress. If you or your operation has current or previous issues getting into the China market (tariffs or otherwise), we encourage you to contact us with your stories.