WASHINGTON, DC – U.S. Senator Gary Peters (D-MI), Ranking Member of the Homeland Security and Governmental Affairs Committee, today called on U.S. Customs and Border Protection (CBP) to investigate allegations that Turkish cherry growers have been routing tart cherry products through Brazil to evade duties on goods imported into the United States. Earlier this year, the Cherry Marketing Institute (CMI) filed a complaint alleging that tart cherry imports from Brazil are being misidentified and misreported in order to avoid paying duties that help Michigan cherry growers compete in the global marketplace.
“Our nation’s cherry producers and the broader cherry industry have suffered due to unfair trade practices,” Peters wrote in a letter to Mark Morgan, Acting Commissioner of U.S. Customs and Border Protection. “Michigan producers have endured ‘dumping’ of Turkish cherry products into the U.S. for years – resulting in a significant drop in the price of their products.”
Peters continued: “Failing to investigate and prosecute alleged violations such as those made by the Cherry Marketing Institute threatens to undermine an industry that has weathered years of unfair competition.”
In 2018, the U.S. government removed Turkey from a list of countries eligible to import tart cherry products into the country duty-free, resulting in a sharp decline of imports from the country. Turkish cherries had previously accounted for over half of all U.S. tart cherry juice concentrate purchases. Imports of tart cherry products from Brazil, which has no identifiable tart cherry industry, rapidly surged once Turkey’s duty-free privileges were removed. Brazil is still eligible to import tart cherry products to the U.S. duty-free. CMI’s report alleges that Turkey could be routing tart cherry products through Brazil in order to circumvent import duties.
The U.S. Department of Agriculture has estimated that the final 2019 U.S. tart cherry production will total 290 million pounds, down 18 percent from the previous year’s numbers. Michigan produces more than two-thirds of the nation’s tart cherries—valued in the tens of millions of dollars. Agriculture is one of Michigan’s largest industries, contributing billions of dollars to the state’s economy and contributing to the employment of about 20 percent of the state’s workforce. Competition from low-priced tart cherry imports has driven down prices for growers in Michigan and negatively affected the tart cherry industry.
Peters has fought to level the playing field for Michigan cherry growers by holding Turkish exporters accountable for continually using unfair trade practices. Peters recently criticized the International Trade Commission (ITC) for reversing its preliminary decision to impose tariffs against Turkish tart cherry exporters after he testified alongside Michigan cherry growers at a hearing in December. He has also introduced bipartisan legislation to help small and medium-sized businesses that are negatively impacted by unfair trade practices from foreign competitors, which President Trump has suggested “is a fantastic idea.”
Text of the letter is copied below and available here:
February 11, 2020
United States Customs and Border Protection
1300 Pennsylvania Avenue NW
Washington, D.C. 20229
Dear Acting Commissioner Morgan:
I am contacting you to request U.S. Customs and Border Protection investigate the attached e-allegation (Case Number e973P121202015) submitted by the Cherry Marketing Institute regarding potentially misidentified and misreported imports of cherry products from Brazil.
As noted in the allegation, data indicate a stark change in import sources of tart cherry products to the U.S. in recent months. Soon after the U.S. government rescinded Turkey’s ability to export tart cherry products to the U.S. duty-free, tart cherry imports from Turkey fell drastically and imports from Brazil sharply rose. Furthermore, data indicate discrepancies involving imports from Brazil—a nation that does not appear to have a discernable tart cherry industry, but which has rapidly increased its exports of cherry products to the U.S. since Turkey’s duty-free privileges were removed. From January 2018 to November 2018, Brazil exported 314,988 liters of tart cherry juice concentrate, yet over the same 11 months in 2019, that amount increased to 3,937,268 liters, representing an uptick of over 1200%. Notably, Brazil is still eligible to import tart cherry products to the U.S. duty-free.
Our nation’s cherry producers and the broader cherry industry have suffered due to unfair trade practices. Michigan producers have endured “dumping” of Turkish cherry products into the U.S. for years – resulting in a significant drop in the price of their products. Between 2006 and 2018, the number of Michigan tart cherry farms declined from 540 to 380, with farms under 200 acres hit hardest.
Failing to investigate and prosecute alleged violations such as those made by the Cherry Marketing Institute threatens to undermine an industry that has weathered years of unfair competition. Consequently, I request you fully investigate this and address any discrepancies to ensure full compliance with the law. Additionally, I request a briefing on this matter as soon as possible. Thank you for your attention to this request.