China is cutting in half tariffs on U.S. fruit and other goods imposed in September and December last year, but leaving in place heftier tariffs imposed in 2018.
The Feb. 6 move by China is a small first step in providing tariff relief for U.S. fruit and nut exporters, industry leaders said. The cuts are effective Feb. 14.
Mark Powers, president of the Northwest Horticultural Council, said in an e-mail that no specific tariff reductions have been confirmed by the U.S. government. However, Powers said initial reports point to a 5% reduction in tariffs on U.S. fruits and nuts.
“That small reduction – from 60%- will not be of much help to fruit exporters,” Powers said in an e-mail.
China’s announcement of a reduction in tariffs on $75 billion of U.S. goods appears to structured to cut in half tariffs that China imposed in September and December (from 10% to 5% and from 5% to 2.5%), said Richard Owen, vice president of global membership and engagement for the Produce Marketing Association. Fruit and nuts from the U.S. were included in those September and December rounds, he said, so the cuts could help U.S. suppliers be more competitive again in the China market.
On Sept. 1 last year, U.S. apples, pears, citrus, cherries and other fruit were subject to an additional 10% tariffs, adding to the 40% retaliatory tariff imposed by China in July 2018.
U.S. exports have suffered under the weight of the tariffs. U.S. Department of Agriculture trade statistics show U.S. cherry exports to China in 2019 were $75 million, down 17% from 2018 and off 39% from 2017. U.S. citrus exports to China in 2019 were $23 million, off 56% from 2018 and down 54% from 2017.
With the mid-January “phase one” trade agreement between the U.S. and China, Owen said it appears that trade relations between the U.S. and China are warming.
“It was encouraging to hear the Chinese commit in the same announcement to eventually remove all the tariffs that were imposed since the trade war begin,” Owen said, noting that the initial tariff increases on U.S. fruit and nuts still remain in place.
Owen said the announcement should encourage U.S. exports to China which have been weakened by the coronavirus outbreak.
“There have been no large-scale U.S. farm sales to China in 2020, no doubt at least partially a result of the outbreak,” Owen said.
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