2017-05-11 / Front Page

Imports flood juice market

By Alan Campbell
Of The Enterprise staff

One of the last appointees to the Trump cabinet may be the most important for Leelanau County, whose cherry growers are asking Washington for protection from a flood of imported cherry juice.

Mr. Robert Lighthizer, meet Mr. Phil Korson.

Lighthizer is President Donald Trump’s nominee for U.S. Trade Representative. He still needs confirmation from the U.S. Senate to begin his tenure, although Trump nominated him on Jan. 3.

Korson is executive director or the Cherry Marketing Institute (CMI), which has been watching warily as imported tart cherry juice has come to dominate a market that was created through a public relations campaign funded by domestic growers.

“The market was built on the backs of American cherry farmers,” Korson said. “In 2008 we launched our campaign to position cherries as America’s super fruit. And we’ve benefited from that. In that market growth, had we had a bigger percentage of that, we would have moved our inventory.”

Instead, some 130 million pounds of the big tart cherry crop from 2016 has yet to be sold.

The numbers for the tart cherry concentrate juice market tell the growers’ story. While the promotional campaign has increased the domestic concentrate juice market from the equivalent of 46 million pounds of tarts to 240 million pounds, the US contribution has remained flat.

Instead, imports of tart cherries have increased 10-fold, from 22 million pounds to 224 million pounds.

Most imported cherries come from Poland, Turkey and other Eastern European countries.

Korson said growers are hoping the Trump administration will tax or somehow limit the amount of cherry juice concentrate streaming into America. He said the Obama administration was largely silent toward requests — but that Michigan’s two Democratic U.S. senators have been supportive.

“I’ve been pushing on the tart cherry problem for about three years now, but really the tide started to change during the (Commerce Secretary) Wilbur Ross interview. Sen. Gary Peters did an outstanding job in the discussion during the appointment process ... I was very pleased, first of all, that the question (about dumping products in the U.S.) was asked, and second that the question was asked by one of our senators.”

Peters appears on board.

“Unfair competition from foreign producers is undercutting domestic cherry growers and making it harder for Michigan farmers to sell their products,” he told the Enterprise. “As a member of the Senate Commerce Committee, I’m working to ensure that Michigan agricultural producers, especially small farmers who have limited resources, can compete on a level playing field, grow their operations and support Michigan jobs.”

Jeff Send, a fruit grower in Bingham and Suttons Bay townships who holds a seat on the CMI board, said a change in the rules is needed quickly to save farms in Leelanau County.

“Over the next three to five years, I’m going to say it’s make or break. I know what we were making ten years ago, and I know what our costs were ten years ago. It was tough back then, and I don’t see the light at the end of the tunnel,” Send said.

Cherry growers are accustomed to facing problems caused by weather. But in recent years they’ve had to also take on infestations of a new bug, the spotted-wing drosophila, which has greatly increased spraying costs.

And now the unsold 2016 crop is combining with a glut of imports to erode market prices for tart cherries.

“(Pricing) is all over the map, all the way from absolutely nothing paid to 30 cents (per pound). I would say the range goes all the way from 10 cents to 30 cents. And it can range down to, ‘Yes, you might get some more,’ or ‘No, that’s all there is.’”

Send said other agricultural communities are also feeling pressure. Much of the problem can be related to a high value for the U.S. dollar, which makes imported commodities cheaper than those grown domestically.

“Right now it appears the American farmer is being hit on all sides. It’s the cattle, the row crop people, it’s the milk producers. It’s all of us,” he said.

Molly Woods, who this spring took over as executive director of the Cherry Industry Administative Board, said two topics related to pricing were discussed at the May 3 CIAB meeting in Grand Rapids. They were how to treat the SWD issue — which increases the cost of production — and market expansion.

However, the CIAB is restrained from lobbying for changes in import policy, she added, as it works closely with the Department of Agriculture.

“Because of concerns of a large inventory, because of concerns about going into another year where we could potentially have a good-sized crop, we looked at our market expansion programs and how we might make those sit better with our current markets,” Woods said.

The CMI, which is an industry-led organization, can discuss imports. Right now, though, cherry growers have no one to hear their case.

“The Trump administration has been more interested in fair trade and more interested on the import issue, so we think we have a chance of doing something about it,” Korson said. “Until (Lighthizer) gets in there, it doesn’t do us a whole lot of good. As soon as he is appointed, we’ll be back in Washington talking to the U.S. Trade Representative.”

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