Washington Apple Growers Caught in Costly Trade Spat with Mexico

Washington Apple Growers Caught in Costly Trade Spat with Mexico

In response to the Trump Administration’s tariffs on aluminum and steel, Mexico announced today that effective immediately imports of apples from the U.S. would be subject to a retaliatory tariff of 20%. Under WTO rules, countries hit with unilateral tariffs are allowed to levy tariffs equivalent to the amount of injury. Apples are just one item on the list of U.S. products that Mexico is targeting.

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Washington State, home to over 1,300 apple growers, is the source of almost all apple exports to Mexico. The state produces approximately 65% of all apples grown in the U.S. and over 90% of U.S. fresh apple exports.

Mexico is the top export market for Washington apples, and during the 2016-17 season, Washington growers shipped 13.7 million 40 lb. bushel cartons valued at more than $215 million to the market. During the current season, shipments have been ahead of last season by 13% and were on track to exceed 15 million bushels, worth an estimated $241.8 million. This new tariff now puts that goal in doubt.

“Any tariff is clearly going to have economic impact to our industry — especially when you consider its cumulative effect along with the tariffs imposed by China and expected within the next few weeks from India, also major Washington apple export markets, in retaliation to U.S. steel and aluminum tariffs,” says Todd Fryhover, the President of the Washington Apple Commission. “The economic impact to individual growers will vary depending on the strategic importance of Mexico to their sales, but collectively Washington apple growers will see a decrease in what they are paid for their crop due to the 20% duty.”

The Washington Apple Commission is the international marketing arm of the Washington apple industry and conducts promotions in foreign markets to drive consumer demand for apples from Washington. Washington produces over 90% of U.S. apple exports, and the Washington Apple Commission provides promotional support to international retailers, wholesalers and importers with innovative marketing programs and activities to grow consumer awareness and brand loyalty.