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| America's garlic capital on trade war: 'We'd love the tariffs to stay for ever' | |
| (about 3 hours later) | |
| Unlike millions of other US farmers, garlic growers are profiting from the trade war with China and have cheered Donald Trump’s latest economic attack accordingly. | Unlike millions of other US farmers, garlic growers are profiting from the trade war with China and have cheered Donald Trump’s latest economic attack accordingly. |
| Sales of California-grown garlic are now increasing after decades of losing ground to cheaper Chinese imports. Sales are poised to get even better as Chinese garlic faces even higher tariffs, with no end to the trade war in sight. | Sales of California-grown garlic are now increasing after decades of losing ground to cheaper Chinese imports. Sales are poised to get even better as Chinese garlic faces even higher tariffs, with no end to the trade war in sight. |
| “In a perfect world, we’d love to see the tariffs stay on for ever,” said Ken Christopher, the executive vice-president of the family-owned Christopher Ranch, the largest of three remaining commercial garlic producers in the United States. | |
| US-China trade war: all you need to know about Trump's tariffs | US-China trade war: all you need to know about Trump's tariffs |
| While many farmers are suffering through the trade war because they relied heavily on imports to China, US garlic growers benefit because they rely overwhelmingly on domestic sales. | While many farmers are suffering through the trade war because they relied heavily on imports to China, US garlic growers benefit because they rely overwhelmingly on domestic sales. |
| Tariffs on Chinese garlic increased from 10% to 25% on 9 May, when the US hiked tariffs on $200bn of Chinese goods and dashed hopes that a US-China trade deal could come soon. | Tariffs on Chinese garlic increased from 10% to 25% on 9 May, when the US hiked tariffs on $200bn of Chinese goods and dashed hopes that a US-China trade deal could come soon. |
| While soybean farmers in the US midwest watched silos fill with unsold crops as their top buyer, China, all but stopped purchases, Christopher Ranch saw domestic garlic sales rise 15% in the last quarter of 2018 after the US applied a 10% tariff on imports of Chinese garlic in September. | While soybean farmers in the US midwest watched silos fill with unsold crops as their top buyer, China, all but stopped purchases, Christopher Ranch saw domestic garlic sales rise 15% in the last quarter of 2018 after the US applied a 10% tariff on imports of Chinese garlic in September. |
| Then Trump ordered even higher tariffs this month after trade talks broke down when China backtracked on a host of issues crucial to US officials. | Then Trump ordered even higher tariffs this month after trade talks broke down when China backtracked on a host of issues crucial to US officials. |
| The escalation came just a few weeks before the US garlic harvest. | The escalation came just a few weeks before the US garlic harvest. |
| “The timing couldn’t be better for us,” Christopher said. “We anticipate a surge in demand for California garlic in the coming weeks.“ | “The timing couldn’t be better for us,” Christopher said. “We anticipate a surge in demand for California garlic in the coming weeks.“ |
| Christopher, 33, whose farm has 5,900 acres of grass-like garlic fields in Gilroy, California, traveled to Washington DC in July to urge the Trump administration to include garlic in the list of imports that would face tariffs. | Christopher, 33, whose farm has 5,900 acres of grass-like garlic fields in Gilroy, California, traveled to Washington DC in July to urge the Trump administration to include garlic in the list of imports that would face tariffs. |
| In lobbying for tariffs, Christopher follows in the footsteps of his grandfather, who fought to implement an anti-dumping duty of up to 400% on Chinese garlic in the 1990s. | In lobbying for tariffs, Christopher follows in the footsteps of his grandfather, who fought to implement an anti-dumping duty of up to 400% on Chinese garlic in the 1990s. |
| “We understand in a broader economic sense that a trade war is not in the US’s best interest,” he said, “But since the tariffs were happening anyway, we needed to be sure that garlic was part of the equation.” | “We understand in a broader economic sense that a trade war is not in the US’s best interest,” he said, “But since the tariffs were happening anyway, we needed to be sure that garlic was part of the equation.” |
| Not everyone is a fan of the garlic tariff. While Christopher was testifying in favor of tariffs to the US International Trade Commission, executives from one of the world’s top seasoning companies, McCormick & Company Inc, were arguing against them. | Not everyone is a fan of the garlic tariff. While Christopher was testifying in favor of tariffs to the US International Trade Commission, executives from one of the world’s top seasoning companies, McCormick & Company Inc, were arguing against them. |
| McCormick says its recipes mostly rely on Chinese garlic, calling it a different product from what is grown in the United States. | McCormick says its recipes mostly rely on Chinese garlic, calling it a different product from what is grown in the United States. |
| “They’re not substitutable,” the CEO, Lawrence Kurzius, told Reuters in an interview. “Just like wine, origin matters and terroir matter.” | “They’re not substitutable,” the CEO, Lawrence Kurzius, told Reuters in an interview. “Just like wine, origin matters and terroir matter.” |
| Taste differences aside, California garlic has traditionally sold at far higher prices than Chinese garlic. It now sells for about $60 per 30lb box on the wholesale market, according to Christopher. Until recently, Chinese garlic sold for $20 a box, but that has risen to $40 with tariffs and will probably soon rise further, he said. | Taste differences aside, California garlic has traditionally sold at far higher prices than Chinese garlic. It now sells for about $60 per 30lb box on the wholesale market, according to Christopher. Until recently, Chinese garlic sold for $20 a box, but that has risen to $40 with tariffs and will probably soon rise further, he said. |
| The new profits US garlic farmers have enjoyed from tariffs are an exception in the US farm sector. | The new profits US garlic farmers have enjoyed from tariffs are an exception in the US farm sector. |
| China last year retaliated against Trump’s tariffs with duties on US goods including soybeans, corn and pork. Farm incomes in US midwest and mid-southern states continued to decline in the first quarter of 2019, according to banker surveys released this month by regional federal reserve banks. | China last year retaliated against Trump’s tariffs with duties on US goods including soybeans, corn and pork. Farm incomes in US midwest and mid-southern states continued to decline in the first quarter of 2019, according to banker surveys released this month by regional federal reserve banks. |
| Trump has pledged up to an additional $20bn in aid to help US farmers hurt by the prolonged dispute after groups such as the American Soybean Association criticized the failure to reach a deal. That’s on top of $12bn the administration promised last year to compensate farmers for trade-war losses. | Trump has pledged up to an additional $20bn in aid to help US farmers hurt by the prolonged dispute after groups such as the American Soybean Association criticized the failure to reach a deal. That’s on top of $12bn the administration promised last year to compensate farmers for trade-war losses. |
| The trade war has also left many west coast specialty crop farmers, like nut and cherry growers, scrambling to find alternative markets after China imposed steep duties on imports that made their products too expensive to sell there. | The trade war has also left many west coast specialty crop farmers, like nut and cherry growers, scrambling to find alternative markets after China imposed steep duties on imports that made their products too expensive to sell there. |
| Jamie Johansson, an olive farmer and the president of the California farm bureau – which represents 400 crops and 36,000 members – said the Trump administration had put California farmers in the middle of tariff wars with four of the state’s five top markets, including China. | Jamie Johansson, an olive farmer and the president of the California farm bureau – which represents 400 crops and 36,000 members – said the Trump administration had put California farmers in the middle of tariff wars with four of the state’s five top markets, including China. |
| “Among our members, I have not heard of anyone benefiting from the current trade war and tariffs,” Johansson said. | “Among our members, I have not heard of anyone benefiting from the current trade war and tariffs,” Johansson said. |
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