WENATCHEE, Wash. — A new 20 percent Mexican tariff on U.S. apples means Washington may fall short of its goal of shipping 15 million, 40-pound boxes of apples there this season, the president of the Washington Apple Commission says.
“Any tariff is clearly going to have economic impact to our industry especially when you consider its cumulative effect along with tariffs imposed by China and expected by within the next few weeks from India,” said Todd Fryhover, commission president. All the tariffs, he noted, are in retaliation to U.S. tariffs on steel and aluminum from those countries.
The Trump administration announced May 31 that it will impose a 25 percent tariff on steel and 10 percent tariff on aluminum imports from Europe, Mexico and Canada after failing to win concessions from those allies.
President Donald Trump announced the tariffs in March but exempted Europe, Mexico and Canada to allow negotiations.
On June 5, Mexico announced retaliatory tariffs on U.S. apples and other items such as pork.
Washington produces approximately 65 percent of all apples grown in the U.S. More than 90 percent of U.S. fresh apple exports come from Washington.
Mexico is the top export market for Washington apples. During the 2016-17 season Washington shipped 13.7 million boxes of apples to Mexico valued at more than $215 million, Fryhover said.
Shipments this season have been 13 percent greater and were on track to exceed 15 million boxes worth an estimated $241.8 million, he said.
“This new tariff now puts that goal in doubt,” he said.
Mexico has imposed tariffs several times over the past 15 years on U.S. apples, usually for alleged apple dumping, selling at less than cost. Tariffs were imposed from 2009 into 2011 over trucking issues. Tariffs have ranged as high as 47 percent.
The last tariff, ranging from 2.44 to 20.82 percent for alleged apple dumping, was imposed Jan. 7, 2016, and lifted that June.
Even with tariffs, shipments have remained around the 10 million-box level.
The new tariff will impact growers differently depending on the amount of their sales to Mexico, but collectively Washington growers will see a decrease in returns, Fryhover said.
The impact of a 15 percent retaliatory tariff set by China in April has been “negligible” so far since it’s the time of year China imports more Southern Hemisphere apples, he said.
India is adding a 30 percent tariff on top of its regular 50 percent tariff on apples in retaliation for U.S. steel and aluminum tariffs.