Washington apple exporters aren’t breaking out the champagne, but news that Mexico’s Ministry of Economy terminated the antidumping tariff on U.S. red and golden delicious apples is seen as an important trade win.
“It is good news and we’re hoping this is the end of the road,” said Jim Archer, manager of Northwest Fruit Exporters, Yakima, Wash.
In a March 1 announcement, Mexican officials said the domestic apple industry in Mexico failed to supply data that showed U.S. apple shipments to Mexico in 2004 and 2005 caused depressed prices or prevented price increases for Mexican apples.
No U.S. red delicious or golden delicious fruit had yet crossed the Mexican border by the afternoon of March 3 with zero tariffs, said Rebecca Baerveldt, export marketing manager for the Washington Apple Commission, Wenatchee.
“You’ve got the typical issues that have to do with the publishing in (Mexico’s Federal Register) and then you have the actual implementation of it,” she said. “I think there are still questions on how this will be implemented.”
Baerveldt said the anti-dumping tariff has been a contentious issue for 13 years.
Archer said Mexico’s anti-dumping investigation started in 1996 and the first duty on red and golden delicious apples was put in place in September of 1997 at a rate of 101%. The complaint was put in suspension, and shippers operated under a minimum price agreement from the spring of 1998 to about 2002.
Mexican growers terminated that agreement in 2002 because they were unhappy with the rolling average f.o.b. price that the agreement was based on.
A new antidumping tariff was applied at 46.5% in August 2002 and has remained in that range. Since November 2006 the tariff as been 47.05%, Archer said. A few shippers had lower duty rates determined separately.
From December through the spring and summer season, Washington apple shippers generally enjoy good demand from Mexico.
Now, Archer hopes the termination of the agreement is the end of the penalty on U.S. red and golden delicious exports to Mexico.
“Growers and shippers have paid their dues,” he said. “This has been a long and drawn out affair and it has been painful to the industry.”
While volume may not surge with the lifting of the antidumping tariff, Archer said he expects more Washington companies will be involved in shipping apples to Mexico.
This season, through early March, about 3.4 million cartons of Washington apples have been exported to Mexico, about 5% down from the same time a year ago. Total shipments in the 2008-09 season topped 10 million cartons.
“We’re just coming into the peak season for shipments to Mexico,” Archer said.
Baerveldt said one question for the Mexican market is the ability of Chile to supply its normal volume to that market, considering the recent earthquake damage in apple growing regions.