Trump has promised new tariffs on steel and aluminum, sparking fears of a trade war. ( File photo )

President Donald Trump has promised to soon put in place long-term tariffs on steel and aluminum, sparking fears of retaliation against fresh produce exports.

Trump said March 1 the tariffs could be in place by mid-March.

“We’re going to build our steel industry back and we’re going to build our aluminum industry back,” Trump said in remarks at the White House.

Canada, Brazil, South Korea and Mexico are the largest suppliers of steel to the U.S., according to the Department of Commerce. Canada, China and Russia are top aluminum suppliers to the U.S.

Leaders of several countries said they would respond if they are hit with tariffs, including Canadian Foreign Minister Chrystia Freeland.

Canada is the top export market for U.S. fruits and vegetables, taking $1.83 billion of vegetables and $1.59 billion of fruit in 2017.

Mexico purchased $570 million worth of U.S. fresh fruit in 2017 and $135 million of U.S. fresh vegetables.

South Korea was the number-three destination for U.S. fresh fruit, importing $490 million of U.S. fruit in 2017.



Mark Powers, president of the Northwest Horticultural Council, said the tariffs announced by Trump are concerning for all U.S. export interests, but the level of concern for specialty crop exporters may depend on what countries are targeted by steel and aluminum tariffs.

If countries do retaliate against U.S. exports, it is unknown if they will go through a formal World Trade Organization process or simply act outside the WTO process.

“That’s a real concern from a policy perspective,” he said.

There is no question that U.S. exports, including fresh produce, might face retaliation with the new steel and aluminum tariffs, said Desmond O’Rourke, economist and president of Belrose Inc., Pullman, Wash.

Mexico, more than Canada, has demonstrated it is willing to retaliate against the fresh fruit industry when it is unhappy with the U.S., O’Rourke said.

Mexico put in place tariffs up to 45% on fruit imports in 2009, shortly after the U.S. ended a pilot program that allowed Mexican truck drivers to operate in the U.S. The tariffs were lifted in 2011 when Mexican trucks were allowed access to the U.S.

O’Rourke said Trump’s move is not unprecedented, and that every president since Lyndon Johnson imposed steel tariffs at various times.

“The steel guys are the greatest whiners in the world,” he said. “They are even better than farmers in saying ‘We are in trouble and we need subsidies,’” he said.

There also may be more uncertainty about Trump’s trade strategy than other recent presidents, O’Rourke said.

“There is this general feeling about Trump that he is unreliable and he could start a trade war which he couldn’t control, but all the other presidents took the same sort of gamble,” he said.

China has waged a “secret trade war” with the U.S. across many industries, including fresh produce, he said.

O’Rourke said China has put in place trade measures that limit U.S. exports, such as deliberately holding back imports of U.S. apples.

“China should be importing 500,000 metric tons of apples, but last year imported only 68,000 metric tons,” he said. “That’s not accidental.”

Concern about a “trade war” is overblown in the sense it is already happening, he said.

“They have been getting away with a lot of unfair trade practices,” he said.

While China needs U.S. soybeans, items like apples, pears and cherries could be an easier target for retaliation, O’Rourke said.




Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
Submitted by Alex Brown on Fri, 03/02/2018 - 17:07

Are there any produce industry writers that don't promote a globalist/anti-American agenda? Are magazines like The Packer only oriented towards pro-export, pro-multinational point of view? Why is it we don't read anything about the farmers with domestic markets that have been wiped out by NAFTA?

The U.S. is the largest consumer market and economy in the world, by far. Rather than a silly article conjecturing about the possible relationship between tariffs on different commodities, why not write an article on Trump's overall trade framework and approach, and how it might affect domestic growing opportunities and/or foreclose/reduce certain export markets.
Was the point of the article to continue to allow foreign countries to dump steel and aluminum and run trade surpluses with the U.S., so that the apple industry can continue it's export market levels?

U.S. trade policy shouldn't be focused on benefiting certain industries to the detriment of others. So, if there is concern that negotiating equitable steel trade terms will decrease produce exports, then isn't it fair to ask whether past trade policy has unfairly hurt domestic steel production, to the benefit of the produce industry? A fair article would point out this obvious fact.
But more importantly, an insightful article would go beyond that, and explain balanced (ie, reciprocal) trading relationships with trading partners, across various commodities and goods.

Rather than taking arbitrary shots at a single commodity that the Trump administration has negotiated trade terms for and attack it's potential indirect impact on the produce industry, a fair article would have pointed to the broader trade framework being developed. In the context of forward looking trade policy, yes, there will be export markets that will be reduced, but conversely there will also be domestic markets where the playing field will be leveled and therefore increased. The willingness to negotiate reciprocal trade agreements will also provide a framework to negotiate and further open up additional export markets.

The biggest losers will be multi-nationals that have taken advantage of trade deals like NAFTA to increase exports into the U.S. from Canada and Mexico. But when NAFTA ends, they will adapt and bring back production, in certain cases, to the U.S. It would be great to read a balanced article about how an America First trade policy is expected to affect various segments of the domestic produce industry. In the meantime, I'll be waiting.

Submitted by Maxmaz on Fri, 03/02/2018 - 17:58

While waiting, you might want to read a book of Economics 101 and learn that a trade deficit depends entirely on the equivalent net negative savings of that country. It is the fact that Americans consume more than what they produce, and that there are citizens of other countries willing to finance them, that create the trade deficit, not the other way around.

In reply to by Alex Brown (not verified)