Michigan cherry growers finally get some good trade news | Michigan Farm News

Michigan cherry growers finally get some good trade news

Category: Politics

by Farm News Media

Tart-Cherry_MFN_11.2.18
U.S. cherry producers had funded more than 50 studies to examine the potential health benefits of tart cherry juice. Research has found that cherry juice can provide an array of health advantages, from soothing arthritis symptoms and easing muscle pain after a workout to enhancing sleep. Until now, however, the rewards of their investment was going to cherry producers in Turkey, due to that country’s unfair trade policies and duty-free access to the U.S. market. (Courtesy photo)

Michigan’s tart cherry growers finally got the news and justice they had been hoping for to stop Turkey’s dumping of tart cherry juice concentrate into the U.S. market. President Trump sided with cherry growers this week, signing paperwork to officially deny Turkey continued duty-free access to the U.S. market.

Michigan Farm Bureau Horticulture Specialist, Kevin Robson called the move a decisive win for U.S. cherry growers, noting Michigan cherry farmers, who account for 75 percent of total U.S. production had been frustrated with blatantly unfair trade policy between the two countries.

“Not only is cherry production in Turkey highly subsidized, they also had duty-free access to import cherry juice concentrate into the U.S. market substantially below our domestic cost of production, which has, without question, decimated our Michigan cherry industry,” Robson said. “At the same time, Turkey had placed a 58 percent tariff on U.S. cherry exports into their country.”

According to Robson, Turkey’s subsidies and duty-free access allow them to sell tart cherry juice into the U.S. at approximately $14 a gallon, while U.S. growers were attempting to compete at $28 a gallon, $4 per gallon below the typical cost of production for a U.S. grower.

Compounding the economic frustrations, according to Robson, was the considerable investment the U.S. cherry industry had made over the last 20 years in product research and development as well as promoting the health benefits of cherry juice, only to see Turkey’s tart cherry industry reap the returns on the investment of U.S. cherry producers.

“This is a glaring example of how unfair and inconsistent trade policies can undermine a segment of U.S. agriculture – something that was completely out of the hands of individual cherry producers,” Robson explained. “With an estimated production value of $54 million in Michigan alone, the economic impact has been significant and severe for western Michigan cherry producers.”

Robson credited the intense focus of Michigan cherry growers to bring attention to the unfair trade policies with members of Congress, as well Cherry Marketing Institute (CMI) president Phil Korson’s efforts on behalf of growers with U.S. trade officials.

“CMI staff and grower-leadership led the charge to petition the United State Trade Representative (USTR) calling for the removal of Turkey who had duty free access to the US Tart Cherry Juice market under Section 503 of the Trade Act,” Robson said. “This past June, CMI testified before the International Trade Commission requesting the denial of Turkey’s duty-free access.”

According to CMI figures, the U.S. was importing approximately 24 million pounds of cherry juice concentrate on annual basis 10 years ago from Turkey. In 2016, that figure had jumped to 200 million pounds of cherry juice concentrate.

According to trade data from Descartes Datamyne, that growth trend continues, noting Turkey has quickly become the number one global supplier of tart cherry juice concentrate, exporting $12.15 million of the tart cherry concentrate into the U.S. in 2017, and predicts that 2018 will set a new record level.

“Cherry juice is available at price points that domestic producers cannot match,” Descartes reported. “Turkey’s cherry juice concentrate exports to the U.S. are virtually duty free in contrast to the 58 percent duty rate that the country places on U.S. exports.”

While acknowledging additional work is needed to boost returns for cherry growers, Robson said it’s a good first-step. “It won’t solve all of our problems, but this direct action by the Trump administration to finally address a long-standing trade issue is certainly a good start for Michigan’s cherry industry,” he concluded.