Mexico may revisit apple tariffs

Dan Wheat/Capital Press Eleodoro Rameriz, wearing a red shirt, packs a tray of Fuji apples into a 40-pound box at Washington Fruit & Produce Co.'s new packing plant in Yakima, Wash., last December. The company is one of a few apple packers in the state enjoying no tariffs on their sales to Mexico this season.

YAKIMA, Wash. — Mexico may decide the future of its temporary tariffs on Washington apples in early June.

The nation could end the tariffs or extend them for five years, said Fred Scarlett, manager of Northwest Fruit Exporters, a nonprofit corporation in Yakima that manages export procedures for apples and cherries.

“I have no idea what they will do but we expect it in early June,” Scarlett said. That’s based on what an attorney for NFE is hearing from the Mexican Ministry of Economia, he said.

Mexico is the largest importer of Washington apples, usually buying about 10 million, 40-pound boxes a season. The record was 16 million boxes from the 2014 crop.

As of April 15 season-to-date, shipments to Mexico total 4.9 million boxes, down 36 percent from 7.6 million for the same period a year ago.

Mexico imposed temporary tariffs ranging from 2.44 to 20.82 percent on Washington exporters on Jan. 7 for alleged dumping — selling apples at low prices that damaged Mexican apple producers — in 2013.

Washington shippers denied the allegations but Economia determined there was sufficient evidence to investigate and impose preliminary duties.

Washington Fruit & Produce, Yakima; Monson Fruit Co., Selah; and CPC International Apple Co., Tieton, were allowed to keep shipping free of any tariff.

According to a Jan. 7 report by USDA GAIN (Global Agricultural Information Network) tariffs were imposed on Zirkle Fruit Co., Selah, at 20.82 percent; Broetje Orchards, Prescott, 17.22 percent; Stemilt Growers, Wenatchee, 10.14 percent; Northern Fruit, East Wenatchee, 9.45 percent; Chiawana, Yakima, 8.27 percent; Gilbert Orchards, Yakima, 7.39 percent; Custom Apple Packers, Wenatchee, 5.55 percent; and Evans Fruit, Cowiche, 2.44 percent.

Producer-exporters who were among 40 responding to a 2015 Economia questionnaire but not among the 12 chosen for audit are at a 7.55 percent tariff, and others who didn’t respond to the questionnaire face a 20.82 percent tariff.

Mexico officials could conclude there was no dumping and drop the tariffs or they could conclude there was dumping and impose tariffs, which would typically last five years, Scarlett said.

Rebecca Lyons, export marketing director of the Washington Apple Commission in Wenatchee, said a 12 percent reduction in the value of the peso versus the dollar, a smaller 2015 Washington apple crop and higher prices have all contributed more to the drop in exports to Mexico than the tariffs. The tariffs hurt some shippers more than others, she said.

Overall exports are down 30 percent because of the strong dollar and higher prices, she said.

Mexico imports will likely finish the season at about 9 million boxes, Lyons said.

Attorneys for several Washington fruit companies spoke at an Economia public hearing on the case in Mexico City on March 17. Cass Gebbers, co-owner of Gebbers Farms in Brewster, was the only company principal to attend and speak, Scarlett said.

Gebbers declined comment.

West Mathison, president of Stemilt Growers, said the company is in the process of having Economia review data. He said the impact has been small this season as most of Stemilt’s fruit is sold domestically.

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