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Cherry bumper crop needed in face of tariff

By William Hennelly in New York | China Daily USA | Updated: 2018-03-31 00:04
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While the prospect of a 15 percent tariff on US fruit exports to China is daunting to growers, there's another factor that could play a role in how the market is affected, and it is simply the quality of the crop, for example, cherries.

"Like any ag product, it's in the hands of Mother Nature," Keith Hu, director of international marketing at Northwest Cherry Growers in Yakima, Washington, told China Daily on Thursday.

"I spoke to a lot of the importers and retailers over there in China … it's pretty unanimous that if … the quality is good, the impact of the 15 percent tariff will be minimal."

But Hu said that if this year's cherries are subpar, the tariff could impact sales "greatly".

In response to US tariffs on imported steel and aluminum, China responded on March 23 with its own list of American products it would tax.

China's action came on the same day that US President Donald Trump announced that up to $60 billion worth of Chinese imports could face tariffs.

China's list contains 128 products across seven categories, according to the Ministry of Commerce. The list also includes two different tariff levels — 15 percent and 25 percent.

Facing the 15 percent levy are fresh fruits, dried fruits and nut products, wines, modified ethanol, American ginseng and seamless steel pipes.

Products exposed to a potential 25 percent levy tax are pork and pork products and recycled aluminum.

Cherries are a desirable product in China.

"The cherry is one of those perishable goods that is very attractive to the Asian consumer," Hu told China Daily in January 2015. "Tastes good, looks great. It's very appealing."

Cherries are rich in antioxidants and also help reduce inflammation, among other health benefits.

"Red means good luck and prosperity,"Hu said. "It's good for you to eat dark greens and dark red products."

The cherry growers have the benefit of the calendar, should the US and China sort out the trade dispute. Peak cherry harvest season is from early June to late August.

For China, July is the key month for sales, said Hu, who returned from China on March 24.

In 2017, the US Pacific Northwest states of Washington and Oregon produced 26,432,194 boxes of cherries, at 20 pounds apiece, according to the Northwest Horticultural Council in Yakima, Washington.

A little more than 35 percent of that yield was exported, with an overall value close to $400 million.

China took in 2,976,841 of those cherry boxes in 2017.

While sales of cherries are steadily increasing on Chinese e-commerce platforms such as Alibaba and JD, Hu said the key for the industry's market in China remains wholesalers and offline retailers.

Washington state's 1,400 cherry growers depend on the Chinese market, CNN Money reported. The country counts on US cherries because China's ability to grow them is not as advanced as its production of apples, another key Northwest product that faces the tariff.

"We can't just easily switch markets from China,"Mark Powers, president of the horticultural group, told CNN. "There is no other market that can take that kind of volume."

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