Italian, Spanish and British cheeses will be subject to 25 percent tariffs that will go into effect on October 18, the U.S Trade Representative has announced. Irish and Scotch whiskies, Spanish extra-virgin olive oil, Italian and British liqueurs and French wines are also among the wide array of European food and beverage tariffs announced October 2 by the USTR. The tariffs result from a dispute between the U.S. and E.U. over subsidies to Airbus that the World Trade Organization had previously ruled were illegal and are the subject of the largest arbitration award in WTO history, according to the USTR.
“We’re going to see price shock on the shelves,” said Salvatore Russo-Tiesi, General Manager and President of the U.S. office of Bono, the brand belonging to Bonolio s.a.s., which makes extra-virgin olive oil in Italy, Tunisia and a new factory in Spain. Italy is not among the list of European countries facing a tariff on extra-virgin olive oil. The company launched its Spanish Organic Extra Virgin Olive Oil into the U.S. market last month at Natural Products Expo East. “The very best olive oil out of Spain is just as good as Italian olive oil. When made right, the best olive oil can come from many different countries, not just Italy,” Russo-Tiesi said.
Under WTO rules, the EU is not allowed to institute retaliatory tariffs, but Russo-Tiesi expects that may happen anyway. “I think Europe is going that way because they’re trying to play hard ball, saying that we don’t think America will want to fight a second trade war,” he said.
The WTO decision allowing the U.S. to move ahead on the tariffs follows four previous panel and appellate reports from 2011-2018 finding that EU subsidies to Airbus break WTO rules. “For years, Europe has been providing massive subsidies to Airbus that have seriously injured the U.S. aerospace industry and our workers. Finally, after 15 years of litigation, the WTO has confirmed that the United States is entitled to impose countermeasures in response to the EU’s illegal subsidies.,” USTR Robert Lighthizer said. “Accordingly, the United States will begin applying WTO-approved tariffs on certain EU goods beginning October 18. We expect to enter into negotiations with the European Union aimed at resolving this issue in a way that will benefit American workers.”
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The award of $7.5 billion annually is by far the largest award in WTO history – nearly twice the largest previous award. The Arbitrator calculated this amount based on WTO findings that EU launch aid for Airbus is causing significant lost sales of Boeing large civil aircraft, as well as impeding exports of Boeing large aircraft to the EU, Australia, China, Korea, Singapore and UAE markets. Under WTO rules, the Arbitrators decision is final and not subject to appeal.
The United States has requested that the WTO schedule a meeting on October 14 to approve a U.S. request for authorization to take countermeasures against the EU. Pursuant to WTO rules, the WTO will provide this authorization automatically at that meeting.
The tariffs will be applied to a range of imports from EU member states, with the bulk of the tariffs being applied to imports from France, Germany, Spain and the United Kingdom – the four countries responsible for the illegal subsidies. Although USTR has the authority to apply a 100 percent tariff on affected products, at this time, the tariff increases will be limited to 10 percent on large civil aircraft and 25 percent on agricultural and other products. The U.S. has the authority to increase the tariffs at any time or to change the products that are affected, and the USTR will be re-evaluating these decisions continually based on discussions with the EU.
The Specialty Food Association has announced the association’s complete rebranding effort. SFA’s new vision to ‘Shape the Future of Food’ will serve as an umbrella to an array of educational, networking and research offerings designed to better serve the needs of its growing membership.
The newly redesigned SFA logo, an imperfect circle, captures the constantly shifting and evolving industry and the limitless effects that food and drink have on our culture and everyday lives. The logo also represents the association’s 360-degree approach to nurturing and introducing new specialty food products and companies into the marketplace.
Founded in 1952, the SFA’s earliest days were at a time of burgeoning American demand for international goods and global flavors. Since then, and especially through the Fancy Food Shows, countless domestic and international brands have launched in the U.S. market under the auspices of the SFA. In fact, throughout its 67-year history, the association has acted as a catalyst for many of today’s most iconic food entrepreneurs and tastemakers, propelling countless brands into the U.S. marketplace and helping take American companies global.
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SFA now plans to extend membership beyond food producers to include buyers, distributors, and affiliated businesses, too, in order to convene a vital, modern community of food. The rebrand is intended to amplify the association’s established success and promote a dynamic new Specialty Food Association.
“For decades, the SFA has been at the forefront of food innovation. Our top priority is to continue offering new ways to support our always-evolving community and to help our member companies grow and succeed,” said SFA President Phil Kafarakis. “The current American appetite for clean, authentic, flavorful, and healthier foods is here to stay. Through the rebrand and our expanded offerings, we’ll be inviting in a wider range of members to fully represent the marketplace and better reflect the diversity of our consumer-focused industry.”
U.S. Senator Kirsten Gillibrand, a member of the Senate Agriculture Committee, has called on the U.S. Department of Agriculture (USDA) to investigate if fruit and vegetable farmers in New York and across the country are receiving fair prices for their produce. While the prices of fruits and vegetables have increased for both consumers at the grocery store and for wholesale buyers, the prices that farmers receive for these same products has not kept up with these increases – and even gone down in some cases.
“Our New York farmers are facing a produce-pricing crisis. Throughout the state, fresh fruit and vegetable growers are hurting because the prices they get for their produce have stayed flat, and in some cases have even gone down, while the middlemen who move the produce from farmers to grocery stores and grocery store shoppers have seen the prices for the same produce increase,” said Senator Gillibrand, a member of the Senate Agriculture Committee. “Despite this, the USDA has not reviewed the fruit and vegetable industry in decades. We need to understand what is causing these unfair prices for our farmers, and I am calling on the USDA to complete a top-to-bottom review of the fruit and vegetable industry so that we can help New York’s farmers better price their produce and plan for their future.”
United Fresh Produce Association is taking issue with Gillibrand’s position. “The fresh produce industry operates on extremely tight margins, at every stage from grower to wholesaler to retailer. Our industry is the ultimate supply-and-demand economy, and our real goal must be to increase demand for fresh fruits and vegetables,” said Tom Stenzel, President and Chief Executive Officer. “That’s the key to raising prices paid to farmers, allowing reinvestment for growth. Transparency in any supply chain is a good thing, and we always welcome USDA’s analysis of our markets. It’s important for each sector in our supply chain not to lose sight of our goal to grow fresh produce consumption, while fighting with one another over whose share of a dwindling pie is bigger.”
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There are thousands of farms and orchards throughout New York State, and New York consistently ranks as one of the top agricultural states in the nation, Gillibrand noted. “However, data from the U.S. Bureau of Labor Statistics and National Agricultural Statistics Service shows that the prices paid to farmers for many of New York’s specialty crops – including apples, snap beans, cabbage, and broccoli – lag behind the terminal prices (the prices that the middle men who move these same crops from farms to grocery stores receive),” she said in a statement. “Furthermore, structural changes to the fruit and vegetable industry in recent decades, such as new farming technology, nutrition science, and consumer behavior, have left farmers facing uncertainty as they feel that the market is not transparent enough to know if the price they are offered for their produce is fair.”
The persistently low prices that farmers receive for their fruits and vegetables have led to the loss of small family farms, and in the last five years alone, New York lost 11,000 acres of vegetable production. The USDA hasn’t conducted a full review of the fresh fruit and vegetable market for decades, and Gillibrand’s push for a new study of this industry would help identify which factors contribute to unfair prices for farmers and increase transparency in the market. Gillibrand is also calling for the USDA to use new technology to improve farm sales reporting to ensure that data is updated in real time, increasing transparency for farmers and allowing them to see if the prices they receive are fair.