As the nation’s third largest producer of apples, Michigan’s landscape is dotted with family run orchards. In fact, more than 800 apple farms call Michigan home. While we are only three of these apple farmers, we represent Michigan’s growers as leaders within the state’s apple industry, as well as members of the U.S. Apple Association’s Board of Directors.
Together, our three families alone comprise 13 generations of apple growers and have collectively worked the land for 338 years. Our roots, and those of all Michigan growers, run deep throughout the state, supporting the economy and our communities.
While not all Michigan growers export to international destinations, trade is critical to the health and future of the state’s apple industry. If apples destined for export in other areas of the nation don’t find homes overseas they flood the Michigan market, depressing prices and leading to supply issues that impact all of our bottom lines.
In turn, this puts thousands of jobs in Michigan at risk, not just in growing and picking the crop but also in equipment, fuel and fertilizer sales, and in packing and transportation.
This frightening scenario is currently unfolding, endangering all Michigan growers. For farmers and other small businesses in our state there will be no more important debate in Congress this year than passing the U.S.-Mexico-Canada Agreement or USMCA, the trade treaty to update the North American Free Trade Agreement known as NAFTA. Free trade with Mexico and Canada is a lifeline for jobs and the overall economy.
Canada, Mexico and the United States combine to make up one of the most competitive and successful regional economic platforms in the world. The apple industry has benefited greatly under NAFTA.
Prior to the agreement, Mexico imposed a 20 percent tariff on U.S. apples. With duty-free access, Mexico is now our largest export market followed by Canada. Since the enactment of NAFTA, apple exports to Mexico quadrupled and those to Canada have doubled. Export sales to the two markets total nearly $450 million annually.
While the new agreement, USMCA, maintains duty-free access as well as other key protections for the industry, apple growers are plagued by significant retaliatory tariffs by Mexico as punishment for U.S.-imposed section 232 tariffs on steel and aluminum.
Mexico has retaliated with 20 percent (pre-NAFTA level) tariffs, and Canada could add apples to their list at any time. Without the removal of these retaliatory tariffs, the USMCA doesn’t stand a chance of being successful for the agriculture industry.
The consideration of the USMCA comes at a time of great anxiety for farmers and small businesses in Michigan and across the country. New tariffs and retaliation for those tariffs have penalized the very people whose exports help drive job creation and economic growth.
These ongoing trade tensions, and the uncertainty they’ve unleashed, reinforce the need for passage of the USMCA, which would provide needed stability to allow farms and small businesses like ours to plan for the future. North American trade is about long-term, sustainable relationships and contracts. The USMCA would restore that certainty.
The stakes are enormously high. Failure to pass the USMCA and end the harmful tariffs in place on Canada and Mexico could result in the worst possible outcome: withdrawal from the current NAFTA. In that scenario, Michigan would be among the biggest losers.
Not only would withdrawal mean the loss of thousands of jobs, it would decimate the Michigan apple industry’s $450 million farm value, not to mention the significant economic impact of input costs of processing, packaging, shipping and sales, as well as the boost to local communities and schools that the apple industry provides.
Time is of the essence, as our most important trading customers are already seeking more reliable partners and competitors are moving in to take our markets. We must strengthen the bonds of trade with our strongest allies to guarantee we are competitive both at home and abroad.
For all these reasons, our state’s elected representatives in Washington, D.C., must be ready to fight for the passage of the USMCA while also advocating for the removal of section 232 tariffs. The continued health of the Michigan apple industry depends on both.