The Pacific Northwest Canned Pear Service joined forces with the California canned peach and fruit cocktail industries to ask the U.S. government to investigate the Chinese canned fruit industry.
China has become a major supplier of canned pears to the United States. The volume of pear imports from China soared between 2000 and 2003, but then leveled off. China supplies two-thirds of the one million cases of canned pears coming into the United States each year.
Prices of the Chinese pears have remained at about $15 a case delivered, despite higher fuel costs. Rich Baldoz at Snokist Growers said ocean freight is often cheaper than trucking. For example, it costs Northwest canners between $3,500 and $4,000 to send a truckload of pears to New York, which is more than it costs Chinese suppliers to ship all the way from China to New York.
Mark Powers, Northwest Horticultural Council vice president, said U.S. canned fruit industries needed first of all to convince the trade subcommittee of the U.S. House of Representatives Ways and Means Committee that a study of the Chinese canned fruit industry was necessary. The International Trade Committee would then be requested to conduct the study and find out as much as it can about the operations of the competing industry in China.
If the study goes ahead, ITC staff will compile an overview of the canned fruit industries in China and the United States, in terms of acreage, volume of production, processing capacity, and consumption, and then do a more detailed analysis of the Chinese trade, including the cost of production and subsidies producers might receive. The all-encompassing study will also compare the strengths and weaknesses of the Chinese and U.S. industries.
Powers said there are several reasons why such information would be useful to the U.S. canned fruit industry.
“Generally, more information is good,” he said. “China has increased its exports to this country dramatically. It now supplies 67 percent of the canned pears that come into the United States. That’s a significant competitive threat. The more you understand the competition, the better you’re able to adapt or compete.”
If the study indicates dumping might be going on, it could lead to antidumping action being taken.
Another benefit is that it should demonstrate to the U.S. government that the canned pear industry is sensitive to imports, and that should help during trade negotiations. For example, there’s a tariff of 15.3 percent on pears coming into the United States.
“If you want to try to keep that protection in place—which we do—you have to justify why such a tariff is necessary. This kind of study helps to remind people why our industry is sensitive.”
Powers said the canned fruit industries in California have been facing similar challenges. The California Cling Peach Board and the California Pear Advisory Board had decided to request a study and decided to broaden the scope by inviting the Northwest canned pear industry to take part.
Powers said he was not sure when the committee might request the study or when it would begin. It is likely to take between six months and a year.
Until about four years ago, most pears imported into the United States came from South Africa, but China has pushed out most other suppliers, with the exception of Thailand. In 2005, the United States imported almost $7 million-worth of canned pears.
Twelve percent of canned pears consumed in this country come from abroad. At one time, the U.S. industry supplied the entire market. Each can of pears that comes into the country either takes land out of production, or forces more pears onto the fresh market, Powers said. So far, most of the orchard coming out of production has been in California.