April Clayton of Red Apple Orchards in Orondo, Washington did not expect to wake up Thursday morning to new threats of a trade war with U.S. allies.
“It was a surprise definitely and a shock,” she said of the latest headlines that have put Washington apples in the crosshairs.
The Trump administration cited national security concerns in imposing tariffs on steel and aluminum imports from Canada, Mexico and the European Union, but allies are already warning of retaliation.
Mexico released a partial list of U.S. goods at risk, including pork bellies, cheese, grapes, cranberries, and apples.
"It’s a concern, because we need to find a home for our apples, and not just a place for all those millions of pounds of apples, but also somewhere that is economically affordable to send,” explained Clayton. “It is low cost to send our fruit to Mexico, but ship over to China or New Zealand, that's going to be an added cost on our fruit, which is going to be passed down to the farmers."
Washington apples and cranberries remain top agricultural exports, contributing hundreds of millions of dollars to the state's economy, according to the Lt. Governor's Office.
- 2017 apple exports to Canada: $130 million
- 2017 apple exports to Mexico: $126 million
- 2017 fresh cranberries/blueberries (combined in Department of Ag data) to Canada: $21 million
[Source: Office of Lieutenant Governor]
"By imposing tariffs on our friends and allies, President Trump is actively stoking the flames of escalating trade disputes that will almost certainly leave our economy worse off and our country less secure," Lt. Governor Cyrus Habib said in a statement to KING 5.
In addition to possible impact to Washington agriculture and local exporters, manufacturers have expressed concern along with business groups and the construction industry. The U.S. Chamber of Commerce warned of harm to the U.S. economy and impact to job creation.
“We’re in a trade war right now,” said Congressman Dave Reichert, R-WA, who chairs the House subcommittee on trade.
He says the Trump administration didn't consult his committee before making this latest move.
“One can only assume here, I guess that this is a negotiating tactic in order to bring Canada and Mexico to come to the conclusion that they need to adhere to the demands of United States with regard to NAFTA,” said Reichert.
But Reichert calls it a bad strategy and believes it could backfire.
“(Our allies are) not mincing words as it relates to their displeasure in the way the United States is behaving, and they're slapping on tariffs that could amount to billions and billions of dollars to the United States in exports,” he continued.
Reichert said he expressed his concerns to U.S. Trade Representative Robert Lighthizer, along with other House Republicans who wrote the Trade Rep a letter back in March, resulting in tariff exemptions for the U.S. allies.
The exemptions are now set to expire on midnight Thursday, Commerce Secretary Wilbur Ross saying they would end, in part, because NAFTA talks are taking longer than expected, according to an interview CNBC.
While negotiations are expected to continue, Reichert fears not only retaliation by trading partners but also a loss of market share in those countries, something experts say can be difficult to regain.
“We’re going to have fruits and vegetables and whatever other agricultural products we have rot,” said Reichert. “Lots of farmers will lose money; they may lose their farms, may lose their homes. This could be a dramatic impact across the country if they continue down this path.”
“They are playing with the lives of American citizens, their homes, their businesses, their children, their livelihood,” he continued.
Congressman Reichert says he and Ways and Means Chairman Kevin Brady, R-Texas, will demand a meeting with the Trump administration when lawmakers return to DC next week.
In the meantime, farmers like April Clayton say they will keep farming and keep calling their representatives, with the hope a deal can be struck before the situation escalate further.
“I think a lot of farmers will be watching this closely,” she said.
