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US eyes easier market access for soybean meal, easier norms on cherries

US eyes easier market access for soybean meal, easier norms on cherries

July 25, 2018

 

 

At a time when India looks to impose higher tariffs on 29 mostly agricultural products from the US, the latter is eyeing market access for soybean meal and easier norms on its cherries, as it battles the fallout of multiple tariff escalation. "We are looking for market access for American cherries, avocados and soybean meal feed for livestock," said Mark Wallace, Acting Minister Counsellor at the US Department of agriculture. Negotiations on these are on, he hinted.

 

Overall fruit import from the US remained $872 million in 2017-18 and the identified commodities are expected to cash on greater Indian demand for select produce. “India is still seeing major growth in poultry and dairy consumption. With 300 million cows and buffaloes, the demand for quality livestock feed is set to grow,” Wallace added.

 

The US is the third largest global producer of soybean meal and is eyeing newer markets as the country faces a significant glut in the supply of soybeans itself as the largest one — China — has imposed higher tariffs on US soybeans. At the same time, US farmers in the country's northwest, hub for cherry and apple cultivation, have come under pressure as retaliatory tariffs imposed by China on $34 billion worth of produce have been implemented. As the trade war between both nations has intensified, orders for cherries have plummeted.

 

A senior commerce department official said India was looking at market access for its grapes in return. Delhi and Washington continue to discuss a possible way to diffuse the tariff situation, with its trade officials visiting the US early this month. India's tariff hike has been in retaliation to the US government hiking tariffs on aluminium and steel. Senior officials had earlier suggested that India was willing to take back the tariff order if Washington DC exempts Indian steel and aluminium export.

 

Impasse over apple import

 

Set to go live from August 4, the measure targets high-value imports such as apples and almonds, aiming to rake in $240 million worth of duties through higher tax up to 100 per cent. Apples from the US remain among the largest segments expected to be hit by the coming tariffs.

 

The US became the largest source for apples in 2017-18, as trade restrictions on imports of Chinese apples led to a nearly 60 per cent drop in imports from China. Shipments from the stateside stood at $108 million in the last financial year, experiencing a nearly 53 per cent growth.

 

"Domestic production can’t keep up with fast-rising demand. Even if the tariffs are applied, I believe we can manage similar or slightly lesser volumes," Tarun Arora, Director of IG International, one of the largest fruit importers and wholesalers in the country, said. The company exclusively sources from Washington state-based Stemilt Growers, which is the single largest supplier of the fruit to India. Stemilt recently celebrated its 1,000th container shipment by sea to India in a single year, exporting about 1.2 million cartons of 20 kilograms each.

 

"We are not in competition with Indian producers. Our shipments are timed to reach India in January, a different season than when local produce hits the market. There is also specific demand for the large variety of apples that are indigenous to the US," William Young, senior exports manager at Stemilt, said.

 

However, talks with China on liberalising market access on fruits, including apples have continued. "If China is allowed back, we will compete on quality and not in volumes. Chinese producers undercut all other players, in the wholesale market, Chinese apples sell at $14-16 a box, while apples from the US may go for $30-40 a box," Young added. Indian importers of exotic fruits have recently begun spreading out their global orders, Kiwis from faraway Chile and apples from Afghanistan are expected to increasingly become common in Indian stores.

 

Source:https://www.business-standard.com

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