YAKIMA, Wash. — As China bans some U.S. agricultural products in the escalating trade war between the two countries, members of the U.S. canned pear industry wish the U.S. would ban Chinese canned pears.
China sells canned pears in the U.S. at half the price U.S. producers can afford to sell them, says B.J. Thurlby, business manager of the Washington-Oregon Canning Pear Association in Yakima.
“The Trump administration has put tariffs on Chinese canned pears and has increased them, now up to 40%, but the Chinese can still deliver product at $3 to $4 per box less than we can,” Thurlby said.
How to reach an equal price point is the question or “blocking them, which at this point would be my preference,” he said.
Chinese canned pear imports in the U.S. have been increasing since 2006, peaking at 37,429 tons in 2015 and were still at 25,373 tons in 2018, according to the association.
It has aided the decline of the U.S. industry, located in Washington, Oregon and California, and now is causing a problem in what growers are paid, Thurlby said.
The largest Northwest canner, Del Monte Foods of San Francisco, operates a plant in Yakima. It reached a contract with the Washington-Oregon Canning Pear Association, May 29, to pay growers $335 per ton this season for No. 1 grade Bartlett.
The Neil Jones Food Co. (Northwest Packing) in Vancouver, Wash., declined to negotiate with the association and July 17 announced it would pay growers $300 per ton, Thurlby said.
Jones did so to save money in trying to compete with Chinese imports, he said.
It puts Del Monte at a $1 per box disadvantage to Jones in a market where 5 cents per box makes a difference because of tight margins, Thurlby said.
Del Monte has twice the fruit to sell as Jones and is asking to renegotiate its contract, he said.
Del Monte did not respond to a request for comment.
Growers on the association board are considering renegotiating because they don’t want to lose Del Monte, Thurlby said.
But it means less money for growers.
“A Washington State University study in 2010 said it cost growers $439 per ton to grow processing pears and its probably closer to $500 today,” Thurlby said.
Processors paid Northwest growers $300 per ton for No. 1 Bartlett in 2014, $320 in 2015, $340 in 2016, $360 in 2017 and $353 in 2018. The price for No. 2 grade is 62% of the price for No. 1.
With harvest starting, association board members likely will decide soon whether to renegotiate with Del Monte, Thurlby said.
Usually, the processors settle on the same price for growers through the association and Neil Jones refusing to negotiate puts the association in a bad spot where its value may be questioned, Thurlby said.
“Neil Jones has been a good partner on many fronts in the industry. Del Monte has been fair and worked very closely with the industry and has the only plant here in Yakima,” he said.
Neil Jones could not be reached for comment.
The Northwest will pack 2.5 million boxes out of 90,000 tons of processing pears with about 50,000 of that from Del Monte, 20,000 to 30,000 from Jones and 15,000 to 17,000 tons from Seneca Foods, Marion, N.Y., which is closing its Sunnyside, Wash., plant.
The Northwest canned 189,000 tons in 1990, 120,000 in 2015 and 99,310 in 2018. California was 110,000 tons in 2015 and 68,522 tons in 2018.
James Christie, president and managing director of the Seattle trading consulting firm Bryant Christie Inc., has been negotiating for the association with Del Monte.