Spanish Olive Exports to US Plummet Since Tariffs Imposed

Summary

Since the U.S. imposed tar­iffs on Spanish black olives in August 2018, exports to the U.S. have plum­meted, caus­ing con­cern for the Spanish olive indus­try, which has lost €25.5 mil­lion ($28.4 mil­lion) and hun­dreds of jobs. Morocco, Portugal, and Egypt have ben­e­fit­ted from the trade dis­pute, with their olive exports to the U.S. increas­ing sig­nif­i­cantly, while Spanish pro­duc­ers are now look­ing to other mar­kets like China, India, and Pakistan.

Spanish black olive exports to the United States have fallen dras­ti­cally since the U.S. slapped tar­iffs on the prod­uct last year.

Black olive exports fell from 7,385 tons in the first quar­ter of 2017 to 3,850 tons in the first four months of 2019, accord­ing to fig­ures from Asemesa, the asso­ci­a­tion of Spanish table olive pro­duc­ers and exporters.

Previously, 75 per­cent of Spain’s black olive exports made their way to the U.S. That fig­ure has since fallen to 34 per­cent and many pro­duc­ers have been left with nowhere to sell their olives. Some esti­mate that the tar­iffs have cost Spanish olive pro­duc­ers €25.5 mil­lion ($28.4 mil­lion) since they came into force in August 2018 and have led to hun­dreds of lay­offs across the sec­tor.

Officials at Asemesa and through­out the Spanish table olive indus­try are also con­cerned that these tar­iffs will lead to a pro­gres­sive decline in Spanish table olive sales in the U.S., even if the tar­iffs are blocked by the World Trade Organization or lifted.

“The fore­cast is to lose most of the U.S. black olive mar­ket pro­gres­sively,” Antonio de Mora, the sec­re­tary gen­eral of Asemesa, told Merca2, a Spanish busi­ness pub­li­ca­tion. ​“This is some­thing that will depend, in a large way, on the capac­ity of California and the other coun­tries that export black olives to the U.S. to replace Spain.”

Morocco, Portugal and Egypt have been the largest ben­e­fi­cia­ries of the trade spat between the two coun­tries, see­ing their respec­tive mar­ket shares increase to fill the vac­uum left by Spain.

Morocco has been the biggest ben­e­fi­ciary so far. Its table olive exports to the U.S. have increased by 800 per­cent since 2017. Portugal and Egypt have both enjoyed more mod­est gains, see­ing exports rise by 80 per­cent and 130 per­cent, respec­tively, over the same period of time.

Sales of California-grown olives have also increased since 2017, albeit to a much lesser extent, ris­ing by 5.7 per­cent.

De Mora said that he expects black olive exports to the U.S. to con­tinue falling for as long as the tar­iffs are in place.

This fore­cast has led many grow­ers to acknowl­edge that they may have been over-reliant on the U.S. mar­ket. As a result, table olive pro­duc­ers are now look­ing to the east. China, India and Pakistan are all new tar­get mar­kets from Spanish olives.

These tar­iffs orig­i­nated from an anti-dump­ing com­plaint brought by the U.S. Department of Commerce and a sep­a­rate anti-sub­sidy com­plaint filed by two California pro­duc­ers to the U.S. International Trade Commission (USITC). On August 1, 2018 tar­iffs on table olives rose as high as 27 per­cent.

In response, the European Union filed a for­mal com­plaint on behalf of Spain with the World Trade Organization, last February. The trade bloc called the tar­iffs ​“unjus­ti­fied” and ​“unwar­ranted.”

The E.U. later requested the for­ma­tion of a spe­cial task force to inves­ti­gate the sub­si­dies after bilat­eral arbi­tra­tion talks with the U.S. fell apart in March.

However, for the for­ma­tion of the task force to go ahead, a unan­i­mous vote of all the mem­bers was required. The U.S. rep­re­sen­ta­tive voted against the task force.

In its defense, the E.U. said that it had ​“seri­ous con­cerns” about the U.S. inves­ti­ga­tion that led to the tar­iffs, includ­ing ​“the U.S. tar­get­ing of non-spe­cific sub­si­dies, the absence of a pass-through analy­sis and the fail­ure to show the imported olives were caus­ing injury to U.S. pro­duc­ers.”

The U.S. responded that it ​“regret­ted the E.U.‘s deci­sion to request a panel and that the duties on Spanish olives were imposed only after thor­ough inves­ti­ga­tions were car­ried out that were fully in line with WTO rules.”

The E.U. will request the for­ma­tion of a spe­cial task force once again at the WTO Dispute Settlement Body’s next meet­ing on June 24.

Until then, uncer­tainty and anx­i­ety remain strong feel­ings through­out the sec­tor. In the province of Seville, where most of Spain’s black olives are grown, pro­duc­ers have had to trim expenses, usu­ally by lay­ing off work­ers or sell­ing their olives for sub­stan­tially less money to olive oil pro­duc­ers.

“The indus­try and the sec­tor are still wait­ing for impor­tant mea­sures of sup­port from the E.U. and the rest of the Spanish admin­is­tra­tions to com­pen­sate for the loss of turnover in the U.S. and the huge expense that the defense [of the sec­tor] is tak­ing on before the U.S. mea­sures,” de Mora said.

• La Vanguardia


• Agro Popular