Everyone's piling on
Aug 20, 2018
WASHINGTON, DC – In the latest chapter of an escalating diplomatic and economic dispute, Turkey announced yet more retaliatory tariffs against the United States last week, targeting rice as well as other U.S. exports, and initiated a lawsuit with the World Trade Organization (WTO) in response to President Trump’s decision to further raise tariffs on steel and aluminum imports from Turkey.
The new tariffs will raise overall duties on U.S. rice exports to Turkey to a total of 84 percent on paddy rice, 86 percent on brown rice, and 95 percent on milled white rice. Exports to Turkey are variable and extremely price sensitive, and any additional duty on U.S. rice in the face of competing suppliers will harm this export market.
Tariffs targeting U.S. agriculture follow in the wake of the Trump Administration’s sanctions on two top Turkish government officials, after U.S. demands for the release of American pastor Andrew Brunson, who has been held in Turkey since 2016, were rejected by Turkey’s President Tayyip Erdogan.
The dispute over tariffs and diplomacy has caused the value of the Turkish currency to plummet to record lows. Turkey’s economy had already been facing intense inflation, and the instability of the Turkish market is damaging for U.S. rice exports.
Turkey has yet to import any U.S. rice in 2018 due to its relatively high price compared to cheap competitors. Consistent access to the Turkish market is also hampered by stringent phytosanitary standards and GMO contamination policies that are not based in science. Additional tariffs will not improve this already volatile situation.
“For the past two decades USA Rice has run an extensive and aggressive promotion program in Turkey - one of our largest commercial markets for medium-grain rice,” said Chris Crutchfield, a California rice miller and chair of the USA Rice subcommittee on Asia and Turkey promotion. “As a result, Turkey has become an important buyer of medium-grain milled and paddy rice from both California and the South. In 2018, we will harvest a near-record medium-grain rice crop in the U.S., and it is critical that we have access to the large Turkish market so we are very concerned about the announcement of additional tariffs on U.S. rice exported to Turkey.”
In this challenging market environment, U.S. rice is still available on Turkish retail shelves for now. USA Rice continues to support sales through in-store promotions and media servicing, and remains vigilant as the trade situation evolves day by day.