Jan 27, 2015
U.S., China apple agreement goes both ways

All apple varieties produced in the United States will soon gain access to the Chinese market, and Chinese fresh apples will soon gain access to the U.S. market.

The agreement was announced Jan. 26, after bilateral trade negotiations between U.S. and Chinese representatives in San Francisco. According to the Washington Apple Commission (WAC), U.S. and Chinese officials agreed to a “regulatory framework to expand apple access from the United States to China.” Danelle Huber, an international marketing specialist for WAC, said the agreement was reciprocal and that Chinese fresh apples would be allowed in the United States.

The U.S. Apple Association (USApple) stated that the decision would be effective about 45 days from the date of agreement, and that it allowed “direct shipment of all U.S. varieties from all states.”

“The new access for American exports … will result in high-quality, fresh U.S. apple varieties available for consumers in China and a significant boost in sales for American apple producers,” said USDA Secretary Tom Vilsack.

The agreement has the potential to boost U.S. fresh apple exports, valued at more than $1 billion in 2013, by about 10 percent. The apple industry estimates that within two years, exports to China will reach 5 million bushels annually, at a value of nearly $100 million per year, according to USDA.

China has allowed the direct shipment of Red and Golden Delicious from Washington state since 1994 (except for a recent moratorium), but the original market access decision did not go beyond that, according to WAC.

Since Red and Golden Delicious are declining in production, achieving full access for all varieties from all states was a critical achievement for U.S. growers, according to USApple.

“The Washington apple industry has changed tremendously since we first gained access to China in 1994,” said Todd Fryhover, WAC’s president. “Red and Golden Delicious now account for less than 40 percent of our overall volume, and gaining access for the rest of our varieties allows us to provide Chinese consumers with more high-quality choices from Washington.”

Although it’s the world’s largest apple producer, China is a major market for Washington apples. The country bought 3 million 40-pound cartons, worth an estimated $55 million, during the 2010-11 marketing year, making it the industry’s fourth largest export market that season, according to WAC.

Gaining access to a potentially huge new market couldn’t have come at a better time for the Washington apple industry, which produces more than 90 percent of all U.S. apple exports. Washington is grappling with its largest crop ever – 162 million bushels, according to a USApple forecast – and is facing some unexpected hurdles. A work slowdown at West Coast ports, a Russian ban on U.S. produce, a potential anti-dumping case in Mexico and the worldwide effects of the strengthening dollar all make the China agreement “a welcome bright spot,” said Barbara Walkenhauer, chair of WAC’s board.

Tit for tat

“Our growers produce premium-quality apples of many varieties, and this year’s record crop makes it even more exciting to see a new export market open up,” said Jim Bair, president of USApple. “But, what our industry has had to do – and will need to continue doing – is assure those growers’ best interests are considered both abroad in new markets like China and here in the domestic market, where other apples could in turn be brought in.”

The agreement also gave Chinese fresh apples access to the U.S. market. To assuage grower concerns about the threat of pests and diseases from China, the Tree-Fruit Technical Advisory Council – a coalition of scientists created by USApple and the Northwest Horticultural Council about 15 years ago ­– has reviewed the country’s import request at every step to ensure the U.S. industry will be protected, according to USApple.

Matt Milkovich

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