US citrus: No help from Phase One trade deal

Phasing in Phase One

U.S. and Chinese agricultural exports could very well benefit from the Phase One provisions, which calls for both parties “not to implement regulations or assessments that are not science- or risk-based,” according to Duane Layton, an international trade attorney at the law firm of Mayer Brown. China has also “agreed to implement a transparent, predictable, efficient, science- and risk-based regulatory process for evaluation and authorization.”

It’s unclear how the U.S. would enforce any of the buying levels spelled out in Phase One, let alone for citrus which is not even mentioned in the agreement. On the other hand, the agreement does loosen restrictions on other agricultural commodities, paving the way for increased U.S. exports to China.

Chapter 3 Annex 11 Article 6 of the agreement provides that within one month of the deal going into effect, China’s General Administration of Customs (GAC) and the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service (APHIS) will implement a phytosanitary protocol to allow the importation of Californian nectarines into China. Articles 7 and 8 call for APHIS and GAC to implement protocols within three months to permit the importation of U.S. blueberries and Californian Hass avocados into China. All that is great news for American growers of blueberries, nectarines, and avocados, but it doesn’t do anything for citrus growers.

California and Florida are responsible for most of the world’s orange production, according to a recent report from ResearchAndMarkets.com. The U.S. is the world’s fourth largest overall citrus producer, behind Brazil, China, and the European Union. About 90% of oranges grown in the U.S. are consumed by the domestic market, while nine percent are exported. But Chinese importers have historically paid a premium for U.S. citrus, benefiting growers’ top lines and playing a stabilizing role for prices.