Washington’s agricultural stakeholders continue asking the Trump administration to resolve problems stemming from the current trade war between the U.S. and other major trading partners for farm-related products.
President Donald Trump announced a $12 billion farm aid plan in July, however several farm advocates and growers responded saying they would rather the U.S. tariffs be dropped so the industry can work toward regaining normalcy in its export markets.
Mark Powers, President of the Northwest Horticultural Council (NHC), told Lens that the current trade environment has created several challenges for Washington growers.
“The cherry season operated under a retaliatory tariff under China for the entire season. We had to divert shipments, look at other markets, and the return to grower profits were affected.”
At the end of July, President Donald Trump tried to alleviate some of the negative effects when he announced a $12 billion emergency farm aid plan to help farmers struggling within the trade war. The $12 billion strategy includes federal payments to growers and assistance with opening new markets.
Washington growers, however, told Governor Jay Inslee that they are interested in “trade, rather than aid.” Trump has also been criticized by U.S. Republican Senators for not removing the original tariffs outright, as they end up hurting U.S. farmers.
“The aid that has been outlined is marginally beneficial at best,” said Powers, adding that the direct payments outlined in the plan do not apply to fruit growers.
The Washington ag industry also has not traditionally been involved with food purchase and distribution programs. The trade promotion sections would be beneficial, he added, however they would act as long-term solutions.
Powers added that a negotiated solution on the steel and aluminum tariffs would be most beneficial for the agricultural sector, as it is the cause of retaliatory tariffs from India and Mexico. It isn’t as simple of a solution for China, however agricultural stakeholders are urging the Trump administration to begin negotiations as soon as possible and to solve the problem so the tariffs come off farm-related products.
“We are talking with the administration about what would be better designed to assist our growers, but the real objective is to get back to a normal trading environment which is absent with these retaliatory tariffs.”
Todd Fryhover, President of Washington State Apple Commission (WSAC), told Lens that the industry is lucky that the trade war’s immediate effects on the apple industry have been relatively minor. This will not be true of the upcoming harvest, however.
“Essentially we are through the majority of our season and there is less than 10 percent of fruit left to sell. We are gearing up for the new crop, so the impact today is relatively negligible.”
It is fairly normal for shipments to drop off during this time of the year between the negotiations with China and India having its own strong apple industry to make purchases from.
In the current landscape, Mexico has a 20 percent tariff on U.S. apples, and China’s is at 50 percent. It is still unclear whether or not India will increase its current duty of 50 percent to 75 percent or keep it the same. The decision has now been pushed back to September 18.
Washington’s apple harvest typically goes from September to August and should begin in the next two to three weeks. Washington however has a 12-month market open for Mexico, and the country is the apple industry’s number one export market.
Fryhover said that the harvest will be busy through mid-November and then the export season typically begins at the end of September.
Two years ago, U.S. and Mexico experienced trucking issues across the border which resulted in an economic loss of $44 million over that 12-month cycle.
“That’s a big number for an industry like ours and similar to what potentially will happen in the future” with the current export environment.
“Right now, and without any current change to the tariff issue, somewhere just south of 50 percent of all our export market volume is affected by a tariff if India follows through with its tariff increase. That is significant, no question about that,” said Fryhover.
The effects will be felt especially by growers in central Washington. He added that the red delicious variety will be hit hardest since India imported 8 million bushels of Washington apples this year, and 7 million of those were red delicious.
There is also the issue of finding open markets for the upcoming harvest.
“Without any kind of trade liberation or return back to normal I think you are going to see some impact in the Washington apple industry for sure,” he said. “If you can’t export as much, you have to move product in the U.S. domestic market and then you have to consider how that will affect brethren in New York and Pennsylvania who are also significant apple producers.”