WENATCHEE, Wash. — The Washington Apple Commission is focusing on Vietnam, India and Indonesia for potential growth of apple exports as China remains questionable.
Even with the Dec. 13 announcement that agriculture is included in a new Phase One U.S.-China trade deal, Todd Fryhover, Apple Commission, president expressed caution, saying the “devil is in the details.”
He noted the U.S.-China Business Council has not been very optimistic, that Chinese apple importers have to make a profit and that lower tariffs would help.
With a 60% tariff China still imported 908,809 boxes of Washington apples last season, but so far is down 23.8% from the same point a year ago, Fryhover said, adding it could end up about 700,000 boxes this season which “could be a real disappointment.”
While a smaller market than India, Vietnam is the only one of the three that is growing and appears to be the most trouble-free. It has a 10% tariff compared to India’s 70% and doesn’t have the import permit problems of Indonesia.
“The average age in Vietnam is 32. There are 97 million consumers there. It’s a young society. These are the people we need to convince to eat more apples and they’re users of social media networks,” Fryhover told apple commissioners at a Dec. 11 meeting.
Fryhover had just returned with two Washington apple growers from a promotional push in Indonesia, Thailand and Vietnam that was funded by Agricultural Trade Promotion federal tariff relief.
They met with consumers in marketplaces and with retailers and importers. Growers John Freese of Omak and Jose Rameriz of Royal City accompanied Fryhover.
Simultaneously, growers Carlos Lopez of Cowiche and Andy Arnold of Mattawa took part in a similar trip to Mexico led by Rebecca Lyons, the commission’s export marketing director.
Arnold, who also is director of farm operations for Domex Superfresh Growers in Yakima, told commissioners that a large Mexico City marketplace was a big eye-opener.
“They put everything off their own trees in the market, even apples with russet and bitter pit,” Arnold said, noting the superior quality of Washington apples.
“Authenticity is the key connection of growers to consumers. Consumers, particularly younger ones, want to know where their fruit is coming from and who grows it. These guys’ stories really resonated with the people we were speaking to,” Fryhover said.
The growers stressed Washington quality and food safety in media interviews in the foreign countries, he said.
A third trip is planned for January to India and Thailand.
The commission is also interested in Colombia, but protests against the government there would make it hard to get media attention. Any trip will be delayed for more favorable conditions, Lyons said.
Mexico is Washington’s largest apple export market, usually taking around 10 million, 40-pound boxes and peaking at over 15 million from the big 2014 crop.
Anticipated passage of the U.S.-Mexico-Canada Agreement is expected to make the Mexican market more reliable with fewer phytosanitary and market dumping allegations.
This year, Mexico has its largest domestic crop in years, which will pressure the market, Fryhover said.
“In a season like this (large crop) we need to do close to 15 million. Right now we’re up 17.4% compared with last year and last year was 10.3 million so maybe we’ll hit 11 million. We have to find a way to pick that up,” he said.
India, Indonesia and Vietnam all have growing middle classes with money to buy Washington apples, Fryhover said.
Even with a 50% tariff on U.S. apples for years, India has been a top market for Washington apples, averaging about 5 million, 40-pound boxes annually worth roughly $100 million. Now the tariff is 70% and U.S.-India trade negotiations appear stalled. Europe also competes there.
Fryhover said he’ll be happy if Washington sells 3 million boxes to India this season.
Indonesia’s peak since 2000 has been 2.6 million boxes and probably will be similar to last year at 1.4 million, he said. Import permit problems continue.
Vietnam is up 71.9% so far this season and should reach 2 million boxes this year, up from 1.7 million last year, Fryhover said.
“It’s a great success because they pay the price and have a wide diversity of varietal interest,” he said.
Vietnam was once a conduit for Washington apples into China, but Fryhover said he hasn’t been able to confirm if that’s still happening.