By Kevin Walker
WASHINGTON — Cherry growers in Michigan and elsewhere have a little more hope now for their industry, now that forces in Washington have been pressed to hear their case.
That happened one more time on Dec. 3, when growers as well as Sen. Gary Peters (D-Mich.) spoke out at a hearing in Washington, D.C. about how tart cherry imports from Turkey have been devastating the domestic industry, most of which is located in northern Lower Michigan.
“We testified for more thanr three hours,” said Nels Veliquette, a co-owner of Shoreline Fruit, LLC, a cherry grower based in Traverse City and one of the petitioners that's asking the U.S. International Trade Commission (ITC) to impose substantial tariffs on Turkish cherry imports.
The ITC is now expected to make a decision by Jan. 14, 2020 on whether to impose tariffs on Turkish cherry imports that could amount to as much as 648.35 percent. In September, the U.S. Dept. of Commerce found that Turkish exporters sold dried tart cherries at less than fair value rates ranging from 541.29 percent to 648.35 percent and that Turkish cherry producers received subsidies from the government of Turkey at a rate of 204.93 percent.
A Turkish cherry producer at the Dec. 3 hearing stated that American consumers buy Turkish cherries because they prefer the quality of the product, and not because of unfair subsidies, according to Elizabeth Drake, an attorney for the U.S. cherry grower petitioners.
If the ITC decides in favor of the U.S. growers, then U.S. authorities would collect money from importers of dried tart cherries from Turkey based on those preliminary rates. In 2018, imports of dried tart cherries from Turkey were valued at an estimated $1.2 million.
“Everything's going to be on pins and needles until Jan. 14,” said Tim Brian, president of Smeltzer Orchard Co., of Frankfort, Mich., another petitioner. Brian was also at the hearing. “Right now it's a five member panel and we need three votes. I'm encouraged. I think we had a good hearing yesterday, but it's in their hands. The ITC decides whether it's going to happen or not.”
About a year ago the Trump administration ended duty free access for cherry juice, something that's considered a symbolic victory for cherry producers. According to Veliquette, Turkey took control of the cherry juice market over a period of many years. Because of U.S. trade law, tariffs won't likely happen against a foreign producer if it comes to dominate the U.S. market that way.
“We saw what happened with the cherry juice concentrate and now the Turks dominate the market,” Veliquette said. “That's why we have to move quickly.”
According to Drake, the action against Turkey was only possible because of the huge increase in the amount of foreign dried tart cherries entering the U.S. market in so short a time.
Because the U.S. cherry industry is so small, challenging what are perceived as unfairly subsidized imports is no easy task. Sen. Peters has been pushing his Self-Initiation Trade Enforcement Act, which is designed to make it easier for the Dept. of Commerce to self-initiate an investigation into unfair trade practices by foreign companies. Brian of Smeltzer Orchard Co. said the cherry growers group that made the petition against Turkish cherries will have spent about $2 million on the action before it's over.
“When I look at trade data and I see something strange, I have to pony up a bunch of money and hire a lawyer,” Veliquette said. “When a small industry has a problem, it should be taken just as seriously as a large industry.”
Veliquette said that recently he's been seeing data showing that cherries are coming into the United States from Brazil, even though Brazil doesn't produce any cherries. He suspects the cherries are really from Turkey, with Brazil being used as a hub for trans-shipment, in order to hide their place of origin.