Jun 10, 2005

Mexico Temporarily Suspends Apple Tariffs

Mexico’s Ministry of Economy has eliminated Mexico’s anti-dumping duty on Red and Golden Delicious apples from the Pacific Northwest, but only temporarily.

The ministry will conduct a new anti-dumping investigation, the result of which could be re-imposition of duties at whatever level the investigation decides is warranted. How long that investigation will take is not known.

A recent report from the Foreign Agricultural Service said: “Over the years, apple trade between the United States and Mexico has been contentious.”

History supports that conclusion.

Not only must U.S. exporters operate under cold storage protocols and pay Mexican inspectors to monitor their storages, there are high tariffs on Red and Delicious apples, the two most popular varieties in Mexico.

The tariffs were imposed after Mexican apple producers filed a complaint that Pacific Northwest growers dumped apples into Mexican markets at artificially low prices in 1996. That led to Mexico’s imposition of a 101-percent tariff and an anti-dumping investigation that resulted in a lower, but stiff, 46.58-percent tariff on Red and Golden Delicious apples.

After three more years, Northwest Fruit Exporters negotiated a minimum price agreement and the tariff was to end in March. Just days before imports were to resume, a Mexican court issued an injunction in favor of Unifruit, an apple producer association in Chihuahua, Mexico, negating the deal. A new investigation of the original dumping charges was ordered.

The last investigation, which went on from 1998 until 2002, was conducted while a 45.68-percent duty was in place. Now, with no duty in place, it is not known how long the investigation will take. The Mexican government has reportedly asked Northwest Fruit Exporters and its 84 grower-members for sales records from 1996, and wants them by the end of June.