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Originally published Vol. 3,
Issue 3 (June 2005)—updated May 2007
U.S. Fruit and Vegetable Imports Outpace Exports
Barry
Krissoff and John
Wainio
The U.S., traditionally a net exporter of
fruits and vegetables, has become a large net importer,
with imports more than doubling between 1996 and
2006 to reach $15.4 billion. U.S. exports of fruits
and vegetables have also risen but less rapidly,
reaching $12.2 billion in 2006. The surge in imports
can be traced to a growing consumer demand for produce
from tropical regions, produce that complements
U.S. seasonal patterns of production, and produce
that competes directly with U.S. production. Because
of geographic proximity and low or zero tariffs,
Canada and Mexico are among the largest sources
and destinations of U.S. trade of fruits and vegetables.
U.S. produce exports are growing
more slowly than imports partly because they are
constrained by high tariffs and slow economic growth
in importing countries. The global average tariff
for the fruit and vegetable sector is over 50 percent,
with tariffs varying substantially across products
and countries. In general, the United States maintains
lower tariffs than most of its trading partners.
Nearly 60 percent of U.S. tariffs on produce are
less than 5 percent, and over 90 percent are under
25 percent. Countries belonging to the Organisation
for Economic Co-operation and Development (OECD),
which together import about 85 percent of the value
of world fruit and vegetable trade, are characterized
by a relatively large number of low tariffs and
a small number of very high tariffs. For example,
most Japanese and European Union fruit and vegetable
tariffs range from 5 to 25 percent. In contrast,
over half of all official tariffs of non-OECD countries
exceed 25 percent, although in practice, non-OECD
developing countries tend to maintain lower tariffs.
Market forces and government policies
also are key factors shaping U.S. fruit and vegetable
trade. The recent decline in the dollar—down
about 13.4 percent in real terms since 2002 against
a basket of horticultural trading partners—has
made American fruits and vegetables relatively less
expensive than those of most U.S. competitors in
importing countries. The main exception is China,
which has maintained a fixed exchange rate with
the dollar, and China’s horticultural products
have begun to compete head-on with U.S. products
in important third-country markets such as Japan.
Partly in response to growing international competition,
in December 2004, Congress passed the Specialty
Crops Competitiveness Act, which (although largely
not funded) authorizes promotional campaigns and
technical and financial assistance designed to enhance
the competitiveness of U.S. fruits and vegetables.
Additionally, ongoing World Trade Organization negotiations,
as well as regional and bilateral trade agreements,
may lead to reductions in tariff and nontariff measures
faced by U.S. fruit and vegetable growers in global
markets.
This
finding is drawn from. . . |
| Trade
Issues Facing U.S. Horticulture in the WTO
Negotiations, by Jason Donovan and
Barry Krissoff, VGS-285-01, USDA, Economic
Research Service, August 2001.
Global
Trade Patterns in Fruits and Vegetables,
edited by Sophia Wu Huang, WRS-04-06, USDA,
Economic Research Service, June 2004. |
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