Chinese importers can’t seem to get enough California oranges after China began lifting some tariffs in conjunction with “phase one,” but US producers of walnuts, almonds, cherries and other specialty crops aren’t seeing a resurgence in trade. US blueberry and avocado farmers are angling to make new sales to China, but it's still unclear if this will happen.
In early March, less than a month after the “phase one” deal became effective, China began exempting importers from paying tariffs on most US ag commodities. Importers, on a case-by-case basis, could avoid paying the Chinese tariffs that were set in retaliation to the US Section 301 tariffs on Chinese goods. That was a swift and major boon for soybean, corn, wheat and sorghum buyers.
That means a punitive 15% tariff remains on US cashews, pistachios, hazelnuts, walnuts, raisins, citrus fruit, grapes, apples and many other products. The impact of those tariffs depends largely on the commodity, according to farmers and the farm groups that represent them.
For California’s orange farmers, it hasn’t stopped trade. For West Coast almond producers, it’s still a major trade barrier.
“All the reports I’ve gotten from our marketers that do business in China show that trade has picked up significantly,” says Casey Creamer, president and CEO of California Citrus Mutual. “The tariffs coming off in March — significantly reduced from where it was — was a huge thing for our exports and our domestic market.”
China’s tariff exclusion program is effectively cutting the tariffs on US oranges from 56% to 26% and the results were immediate. March, April and May are the biggest months for US orange exports to China, and business is booming Creamer said.
The totals are not in yet, but Creamer told Agri-Pulse he expects this year's exports to China to far surpass last year's, when tariffs were in full effect.
While it will be a much-needed improvement, sales still aren’t expected to reach the highest level since the 2017-18 marketing year, which reached 71,000 metric tons and gave the US 20% share of China’s import market.