President Donald Trump’s tariff proposal has been “the talk of the town” recently in import-export circles, said GT Parris, commodity manager for Seald Sweet International, Vero Beach, Fla.
“It has thrown everybody into a little bit of a tizzy trying to figure out how to handle it,” he said.
Industry members are trying to determine what portion of any tariff grower-shippers, retailers or third parties will absorb.
“What we’re finding is, everybody’s taking kind of a partnership in this,” Parris said. “It seems that everybody is kind of working through it.”
One thing is certain, though: A tariff will create a lot more accounting work than produce buyers and sellers are used to, he said. And it likely will create a financial challenge for some.
“Not everybody has the liquid cash where they can continuously pay that tariff up front until they get paid on the back end,” Parris said.
Seald Sweet is operating under the assumption that the existing 10% tariff will remain in effect at least until July 9, under the current tariff policy.
“We think we’ve got it pretty well handled now,” Parris said. “We’re going to roll with that, and we’re looking to have a big year.”
He also thinks Seald Sweet is in a favorable position because the company sources citrus from several countries, including South Africa, Peru, Chile, Argentina, Mexico and Uruguay.
“We feel that gives us an advantage,” Parris said.
Tariff could provide boost
A tariff on imports could be beneficial to California citrus grower-shippers, said Casey Creamer, president and CEO of Exeter-based California Citrus Mutual.
“Tariffs on product coming in could be helpful because the amount of citrus imported into the U.S. has grown exponentially,” he said.
Argentinian lemons, for example, have been coming into the U.S. at greater volumes in recent years and have affected growers in California’s coastal growing region, “cutting profitability for them and the overall lemon market,” according to Creamer.
California’s citrus industry is in a $1.2 billion trade deficit, he added.
“What that means is, we are importing more citrus in the U.S. than we are exporting overseas,” Creamer said. “The import number has been rising, while our export numbers have been dwindling.”
Karen Brux, managing director of the Chilean Fresh Fruit Association, isn’t too worried about the impact tariffs might have when it comes to imports from Chile.
“Tariffs will not impact the volume of citrus shipped from Chile to the U.S.,” Brux said. “And we anticipate that the impact on prices paid by consumers will be minimal.”
