California nut farmers brace for China's tariffs on agricultural products

SAN FRANCISCO - Nut growers in the US state of California are closely watching the Chinese market while bracing for the fallout from China's tariffs imposed on US agricultural products.

Growers associations said the members have expressed worries about the 15 percent tariffs that took effect on Monday. China had announced to suspend tariff concessions on 128 items of US products including pork and fruits.

"We certainly do not like to have any tariffs imposed as they raise the price of our product," said Richard Matoian, executive director of Fresno, California-based American Pistachio Growers.

"When we compete with other countries for market share, such as Iran, we could have our prices higher than theirs, causing Chinese buyers to shift to Iranian pistachios," he said.

Last year, the pistachios exports to China were 140 million pounds (about 126 million kilograms), representing 55 percent of the total exports.

"The (Chinese) market continues to grow, but it is also sensitive to prices," said Matoian.

"When the US had a low production year in 2015 and prices rose, Chinese buyers shifted their buying to Iran (the second largest producer in the world), but as we had record production of pistachios in 2016, Chinese buyers shifted to the US as the prices moderated," he added.

He said the exports also depend on other factors. "With the dollar being lower, it makes our prices cheaper in the foreign market," he said.

Pistachios, almonds and walnuts are among the biggest-value crops in California.

The US state exported more than $2 billion worth of agricultural products to China in 2016-2017. Among which, pistachios, almonds and walnuts represented more than $1.1 billion, according to the California Department of Food and Agriculture.