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Bad Sino-US Fruit Prospects due to Tariffs Formally Imposed on Both Sides

China Agriculture Report By CnAgri2018-10-10 15:31:31China Agriculture Report Print
Since March 2018, the Sino-US trade frictions have intensified: after two tariff increases on April 2nd and July 6th, the cumulative tariffs on fruits exported from the United States to China have increased by 40%, i.e. apples, cherries and plums exported from the United States to China have increased from 10% to 50%, and oranges from 11% to 51%. On September 17, Eastern Time, Trump announced a 10% tariff on $200 billion worth of Chinese imports (including more than 200 kinds fruits and vegetables), which came into effect on September 24 and will be raised to 25% on January 1, 2009. Subsequently, the tariff committee of China’s State Council decided to impose 10% or 5% tariffs on 5,207 tariff items and about $60 billion of goods originated in the United States. Some varieties would face more than twice the tariff rate after the tariff increases, which will seriously affect the U. S. fruit exports, and stimulate the U. S. fruit prices in the Chinese market to rise.
In 2017, China exported only 35,000 tons of fruits to the United States, with an export value of 140 million US dollars. The fruits were mainly apples, pears, litchi, longan, pineapples and bananas. Therefore, the Sino-US trade war has little impact on China's export of fruits to the United States.
However, China is an important fruit market to the United States. In 2017, the US fruits exported to China was 228,000 tons, amounting to 766 million US dollars. The United States is China’s the third largest supplier of fruits, accounting for 60.5% of China's net amount of fruits. The fruit varieties are mainly apples, pears, plums, strawberries, cherries, grapes and citrus fruits (oranges, grapefruit and lemons). Among them, the amount of 27,000 tons of cherries which were exported to China was $170 million, and the value of citrus, grapes and apples reached $88 million, $41 million and $36.7 million respectively.
Therefore, the trade war has a relatively greater impact on the U.S. fruit industry in terms of trade volume. The U.S. also plans to introduce a series of remedial measures, such as food procurement and distribution programs, of which $200 million is used to buy American cherries and apples. But compared with the output of the two countries, the proportion of fruit trade is relatively limited, and the impact on the market is also limited. The greater impact lies in the change of the future trade pattern.
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