Impact of Chinese tariffs applied to U.S. fresh fruit exports

Overview of Chinese Tariffs
The People’s Republic of China’s Ministry of Commerce (MOFCOM) on March 23, 2018 announced a proposal to levy retaliatory tariffs impacting approximately $2.0 billion in U.S. food and agricultural exports to China in response to the recent U.S. 232 Trade Action on steel and aluminum.

Additional tariffs of 15 percent would be applied to exports of fruits, dried fruits and nuts (among other products) from the U.S. in retaliation for tariffs introduced by the United States. Chinese customs began levying these additional tariffs on April 2, 2018.

Source: International Trade Centre Market Access HS06 code

Value of U.S. Fresh Fruit Exports to China
U.S. exports of fresh fruit to Mainland China and Hong Kong were valued at USD $544.5 million in 2017 (Source: UN COMTRADE). China is a sizeable market for U.S. fresh fruit exports.

Potential Impact to U.S. Fresh Fruit Exports
It is difficult to forecast the impact of increased tariffs on U.S. imported fruit into China. Fresh fruit is typically traded through private contracts, unlike grain, soybeans and other commodities, which trade on an open futures market and provide transparent price data. Additionally, there are other factors at play which could affect demand:

Competitiveness of the U.S. dollar
Price sensitivity of Chinese consumers for different fruit categories
Chinese fruit production and quality
Quality of U.S. fruit imports
Supply from competing markets and price differences
Chinese consumers' choice to boycott U.S. items

PMA Research, has prepared an analysis covering the effects and potential impact of the newly announced Chinese tariffs.

To read the full report, please click here.

Source: pma.com