ABOUT THEM APPLES - PART II, FROM GALA TO GRANNY SMITH

With NAFTA in doubt...

"[T]he health of the U.S. apple industry is hanging on a stem."

Jim Bair

October 24, 2017 (publication date on line)

Editor's note. It has been almost three weeks since we published the last TTALK Quote on October 6. We apologize for the unexplained silence, but the TTALK Quotes aren't dead. They were just sleeping.

Sauvie Island Apples - rkm photo

  

The items mentioned above can each stand alone. That said, we are likely hear a great deal more about these and all of the other NAFTA issues in the months ahead. Even so, we are tempted to tack on four, somewhat disparate observations. 

Retaliation. We have no quarrel with the letter to USTR from the members of the Northwest Delegation, certainly not with their concern that if the U.S. makes life more difficulty for, say, Mexican exporters of tomatoes, Northwest tree fruit exporters are bound to feel some countervailing pain. We suspect they are right. It is troubling however--not wrong but troubling - that so much of the discussion of possible NAFTA permutations hinges less on possible new provisions of law and more on a more fundamental notion of practical reciprocity, an "eye-for-an-eye" sort of thing. 

Perishable Products and the WTO. The WTO doesn't get a lot of mention in today's intense NAFTA discussions. It did come up, however, in a private conversation we had in the wake of our earlier reference to America's NAFTA negotiating objective on perishable goods. The wise voice on the other end of the phone pointed out that, in its considerations of antidumping and countervailing duty issues, the WTO looks at annual trade. There is no provision for seasonal trade.

"Bilateral agreements should be WTO-plus," our colleague said, meaning even more favorable to trade. "This would be WTO-minus." 

 
China. China may seem a non-sequitur in this discussion of North American trade. But when it comes to apples, China is the elephant in the room. According to a relatively current USDA estimate, the world will produce some 77.2 million tons of apples this year, more than half of them - 43.5 million tons -- will be from China. China is the world's largest apple producer; the U.S. is number 2, with roughly 4.6 million tons. 

 
Yes, China does buy a fair amount of apples from the U.S., but China's exports here are growing - and if by here we mean North America - then you can add China to the list of countries that are eyeing the possible failure of NAFTA for new export opportunities for themselves. 

Apples Nearby. Finally, a word about Sauvie Island and the apples pictured above. They are hors de combat as far as this discussion is concerned, which is to say they are not exported. They are not even sold in grocery stores. These are pick-your-own apples from Douglas Farm on Sauvie Island. Just north of Portland, Oregon, Sauvie Island on the Columbia River is one of America's largest river islands and home to an array of farms, growing everything from corn to strawberries and apples to pears. The Douglas Farm is one of those and well worth a Sunday stroll if you are out this way.