Blueberries, Bell Peppers Could Be Protected by Safeguard Tariffs Next Year
The International Trade Commission will begin an investigation on whether imports of blueberries from Mexico, Chile, Peru, Chile, Canada and Argentina are damaging domestic growers. The ITC will have until Dec. 30 to determine whether there is serious injury, and increased imports are at least as important as any other cause. According to the ITC, the injury requirement is considered to be more difficult than the one in antidumping and countervailing duty laws. The Office of the U.S. Trade Representative requested the investigation -- only the second time USTR has initiated a safeguard investigation in 25 years -- and is also laying the groundwork for potential investigations into strawberries and bell peppers.
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In 2019, $1.2 billion worth of blueberries were imported, and Mexico was the third-highest source, with $291 million in exports. The largest exporters by value are Peru and Chile, which export in the winter, when there is no U.S. production, and blueberries are pricier. Canada is fourth among exporters, with nearly $116 million in exports in 2019.
Seasonal produce farmers are not able to resort to AD/CVD laws because of the way import surges are calculated, and because growers outside the Southeast don't agree with the argument that Mexico is unfairly subsidizing its fruit and vegetable production. Safeguards are meant to be temporary to allow domestic industry to adjust to import competition.
It is going to be negotiating with Mexico over the next 90 days about seasonal produce exports, and, if solutions the two countries come up with aren't satisfactory to Southeastern farmers, USTR will help them to request monitoring of imports of bell peppers and strawberries, which would make the next safeguard investigation move faster, USTR said.
The announcement after the close of business Sept. 1 pleased Florida Republicans in Congress. Rep Vern Buchanan, the ranking Republican on the House Ways and Means Committee Subcommittee on Trade, tweeted, “special thanks to Ambassador Lighthizer for listening to my concerns.” Sen. Marco Rubio, R-Fla., also issued a press release on the subject.
Produce growers in the West reacted with dismay. The Fresh Produce Association of the Americas said: “This politically motivated action directly undermines the new U.S. Mexico Canada Agreement, positioning the U.S. as an unreliable trading partner despite any trade agreements they negotiate. Mexico is our largest trading partner, with a climate ideally suited for fresh fruits and vegetables. Sadly, partisan politics failed to consider the best interests of American farmers, American businesses, and American consumers who will likely see increased food costs and lower overall farm exports.”
Mexico said it and its affected blueberry growers will have the right to participate in a hearing -- even after injury is determined, there is another hearing about the appropriate remedies -- and noted that any action could be six months away. It said it will make sure that any quotas or tariffs follow both World Trade Organization rules and the NAFTA replacement, USMCA, which Mexico calls T-MEC. On the other crops, Mexico said it will be seeking mutually satisfactory solutions.
Rep. Kevin Brady, R-Texas, said in a conference call with reporters that he knows there's both support and opposition for trade remedies against Mexican fruit and vegetable imports, and he encouraged more consultations with Mexico around the issue. But he said he believes USTR is trying to strike a balance with seeking evidence of injury to blueberry farmers, and starting fact-finding on strawberries and bell peppers.