Food Service & Agriculture and Government

Tariff tensions escalate

MDARD working behind the scenes to fortify trade relationship between state and China.

September 21, 2018
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The tariff war between the United States and China has been rapidly intensifying, but Michigan is trying to help with the strained relationship.

President Donald Trump announced another round of tariffs this month. He said he is planning to place tariffs on about $200 billion in Chinese imported goods. In retaliation, China declared plans to institute tariffs on $60 billion in U.S. exported goods.

Despite the publicly waged battle between the two countries, the state of Michigan is working behind the scenes with China to fortify the trade relationship between the state and country.

Gordon Wenk, director of the Michigan Department of Agriculture and Rural Development, traveled last week with representatives from Michigan companies including Shoreline Fruit Growers Inc., Graceland Fruit, Cherry Central, Dave’s Sweet Tooth, Journeyman Distillery, Peterson Farms Inc., the Corn Marketing Program of Michigan and the Michigan Potato Industry Commission to Beijing, Shanghai and Guangzhou in China.

The trade mission included one-on-one meetings, retail tours and briefings with U.S. Department of Agriculture officials within the country, as well as potential buyers.

“We need to continue to work on our existing relationships that we have with one of our core trading partners because, at some point, the trade disputes will be negotiated to a settlement,” Wenk said.

Although Wenk said he doesn’t have any idea of when the tariff war will end, he acknowledged the state heavily depends on its exports to China. Wenk said in 2017, Michigan exported $141 million worth of food and agricultural products to China.

The largest export product was wood, which amounted to $62 million, he said. Dried cranberries garnered $21 million, while dairy products resulted in $17 million, wood pulp returned $12 million to the Michigan economy, and vegetable saps from hops drew $6 million in sales, Wenk said.

“Traveling to China (provided) companies an opportunity to see firsthand the market potential and to meet face to face with key buyers,” said Jamie Zmitko-Somers, manager of MDARD’s International Marketing Program.

During last week’s trip to China, Wenk and Michigan companies met with some current buyers, but he said they also met with new companies, despite the tariff conflict. One of the businesses is a company that operates on an e-commerce platform, and Wenk said it was interested in Michigan’s products, including cherries and candies.

According to MDARD, the companies that participated in last year’s trade mission — Shoreline Fruit Growers, Graceland Fruit and Cherry Central — projected an export sales increase of almost $1 million within six to 12 months as a direct result of participating in the earlier trade mission.

In addition, more than 80 new buyer contacts were established, per MDARD.

Wenk said Michigan looks to export to different states, but there also is a need to export internationally. Two of the new markets Michigan has been exploring this year are Australia and New Zealand.

“It is really about looking at new market opportunities there might be to help us open doors and build relationships and provide a home for the great products of Michigan,” Wenk said. “We are going to keep knocking on doors all around the world.”

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