-Growers hurt by tariffs – suffer low price –
Chilean exports take our place
-March 7,2019-
Who is winning the trade war between the US and China? Chile may be the victor for now selling their 2019 walnut crop into China in large volume say local walnut growers.
Visalia walnut farmer Sam Sciacca says” I think its just too late for US walnut farmers to ship into China, even if there is a trade deal announced in coming weeks.”
This has been a tough year for US walnut farmers who are suffering on price, well below break-even point, getting just 70 cents a pound, half what they got the year before.
Collin Kapigian, Field Representative for Grower Direct Nut Co says” Chile is our big competition” adding a large carryover of the US crop from the year before has also hurt returns this year.On top of that, the strong US dollar is hurting overseas sales. Kapigian says their growers are receiving about 75 cents per pound.
Sciacca says domestic sales have not made a difference either, despite all the news of health benefits of walnuts recently reported.
Other press reports confirm the extent of the problem.
Low pricing has caused a recent surge in California walnut shipments says a Fresh Plaza story.
“Supplies of walnuts are becoming limited, especially on premium grade walnuts as lower prices are entering the global pipeline,” says Mark Calder of Primavera Marketing Inc. in Linden, Ca.
“Sales and deliveries have sped up in recent weeks and this is mainly attributed to walnuts selling at virtually half price compared to one year ago. I have never seen such a rapid reduction and it is extremely unfortunate to our growers who collectively delivered outstanding quality this season.”
While California is a strong and preferred supplier of walnuts globally, it’s not the only producing region. “The Chinese have greater production than California. And additional acreage coming into production from Chile has also intruded on some key export markets that we ship to,” says Calder. “Global supplies are increasing and will surely effect how we market California walnuts in the future.”
California Walnut Commission Senior Marketing Director Pamela Graviet has said that tariffs recently applied to many products including walnuts shipped to China, Turkey and India will result in a $300 million loss to the California walnut industry.
California walnuts supply two-thirds of the world’s walnut trade, according to the California Walnut Board.
It not just a trade war with China that is opening the door for California’s ag competitors to take away markets we have nurtured for years.
Chilean walnut exports to the Middle East are up this year.Chile saw Middle East and North Africa exports rise 19% to over $425m in part due to walnuts.
President Trump’s decision to pull out of the Trans Pacific Partnership (TPP), renegotiation of the North American Free Trade Agreement (NAFTA), an ongoing trade battle with China and resulting retaliatory tariffs against the United States are all trade policies that are costing U.S. farmers dearly, according to an updated Purdue University analysis released earlier this month.
The updated study said a U.S. re-entry into TPP would turn a current agriculture trade loss into a gain. In addition, the study says that backing out of NAFTA and failure to implement the USMCA, would lead to an additional $12 billion in annual losses in agriculture export revenues.
After the U.S. pulled out of the TPP, the remaining 11 countries including Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, negotiated the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
Speaking at a Farm Foundation event on Monday in Washington, D.C., Don Buckingham, an attorney with the Canadian Agrifood Policy Institute, said work done between the U.S. and Canada on trade agreements laid the groundwork for a possible re-entry of the U.S. into the TPP.
Most US farmers favor the idea.
Inability to sell products overseas caused the US. trade deficit to balloon in December to a 10-year high of $59.8 billion, well ahead of expectations, despite President Donald Trump’s efforts to reduce the number, the Commerce Department reported Wednesday.
The deficit was the result of a 2.1 percent increase in imports to $264.9 billion while exports fell 1.9 percent to $205.1 billion.
Also slow global growth appears to be reducing demand for U.S. goods, even as a stronger dollar is worsening the trade balance.