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CASE NUMBER: 466
CASE MNEMONIC: APPLEMX
CASE NAME: U.S. Apples Are Not So Red Delicious
I. IdentificationThis discrepancy is the key to the case as the Mexican Ministry of Commerce chose to disregard the US' industry submission and, instead, based its preliminary determination on information supplied by the Chihuahua State Fruit Growers Association -- the petitioner in this case. As a result, the Government of Mexico on Monday September 1, 1997, announced its preliminary determination in the antidumping investigation of US Red Delicious and Golden apples by imposing 101.1 percent compensatory duty on imports of those apple varieties. According to the NWHC, a "carton of apples with declared value of $20.00 is now subject to duties of $4.00 (20% import duty) and $20.02 (101.1% compensatory), bringing the total value to $44.02. Importers may be allowed to post a bond on a fraction of its preliminary compensatory duty owed.
On September 26, the NWHC filed a motion in Mexico's civil court seeking an injunction against the Mexican government's September 1 imposition of the 101.1 percent compensatory duty. However, on October 7, 1997 a civil court in Mexico City denied the US industry's legal motion seeking an injunction against the Mexican government's September 1 imposition.
The NWHC continued to aggressively contact US government agencies to seek legal and political help in ending Mexico's compensatory duties and to be able to restore access to its largest export market. As a result of the political efforts, the US Trade Representative and Department of Commerce officials met with their counterparts from Mexico's SECOFI on October 8 and again on October 20 in Washington. During these meetings, the Clinton Administration expressed their objections to SECOFI's procedural handling of its antidumping investigation.
Resulting from pressures by the US government, SECOFI officials scheduled a visit to WAshington state for the week of November 10, 1997 to verify the detailed marketing information supplied by Price Cold Storage and Washington Fruit & Produce which had been part of the US industry's submission of evidence in the case.
On November 24, 1997 the Northwest Horticultural Council made public the results of the Mexican verification audit of the US apple industry as part of the government's antidumping investigation of Red Delicious and Golden Delicious apple imports from the US. In the announcement, the Council stated that Mexico's Secretariat of Commerce and Industrial Development concluded on a post-audit report that "officials did not find any significant differences between the information reported to the Secretariat and that registered in the accounting records". This last finding should conclusively prove that no dumping occurred, and that US apple growers' access to Mexico's market should be immediately and fully restored. In theory, the Mexican government should issue its final determination in this case and it compensatory duties should be removed to pre- September 1, 1997 levels. In practice, it has not happened. The NWHC stated in its press release dated November 24, 1997 that "there's absolutely no justifiable reason to delay the issuance of a final determination in it case" and that "Mexico's imposition of this unjust, prohibitive duty should be immediately eliminated before any additional economic harm is done to our apple industry."
The question remains as to whether the sanctions on U.S. apples are legitimate. In the past, both the governments have repeatedly linked the inaction of one government to the sanctions on the other's products. It has been suggested that the Government of Mexico chose the apple industry in order to get the U.S. government to address the avocado case. Mexico is the largest importer of U.S. apples and consequently a market that if closed, it would directly have a major effect in the U.S. apple industry. It appears that this tactic has played well for Mexico as the U.S. apple industry wasted no time in contacting their Representatives to address the issue.
The area first became known to American pioneers at the turn of the 19th century and by 1826, early settlers had discovered the area's rich lava-ash soil and plentiful sunshine created perfect conditions for growing apples. The arid climate also meant fewer insect and disease problems and a smoother finish on the apples than in some other places.
Noting the health and vigor of apple trees planted along stream banks, pioneers developed irrigation systems and by 1889, commercial orchards were established. Most apple-growing districts in the state are still located along the banks of major rivers.
The average size of an orchard is less than 50 acres,
but some cover as many as 3,000 acres and employ 300 or more workers year-round.
An estimated 35,000 to 45,000 pickers are employed during the peak of harvest.
More than 99 million boxes of apples were picked for the fresh market in
1996 to supply half of America's fresh apple needs and satisfy customers
in more than 40
countries around the world. Washington state growers successfully harvest
a wide variety of apples including Red and Golden Delicious, Granny Smith,
Braeburn, Jonagold, Fuji, Gala and many
others.
First planted in Washington in the 1920s, the Red Delicious is a relative newcomer in Washington state's 100 years of apple growing history. The variety's flavor, texture and durability, however, caught the world's attention, and in 1996, Red Delicious comprised 59 percent of the state's total crop.
Washington's most popular export apple, Red Delicious, is especially enjoyed in Mexico, Hong Kong, Indonesia, Saudi Arabia, Singapore, Malaysia, Colombia, Brazil, the Philippines and Thailand.
Orchardists continually improve growing methods to
produce apples that are crisper, juicier, more flavorful and store better.
Growers now use dwarf trees in high-density plantings to bring new orchards
into production faster. This allows Orchardists to get faster return on
their investment and to respond more quickly to consumer demand for popular
new varieties. The smaller trees also make harvest more efficient since
each apple is handpicked.
Wenatchee/Yakima 94/95 Crop:
Number of Growers:
Rank:
Labor:
National Rank:
More than half of all fresh apples grown in the U.S. come from Washington.
Michigan and New York, the next ranking states, grow less than 1/3 as many
apples as Washington.
Where Sold:
First Tree:
The first apple tree planted in Washington was planted in 1826 at Ft.
Vancouver, WA by Lt. Emilius Simpson of the Hudson's Bay Co.
Production:
A fully-producing apple tree may grow up to 20 boxes of apples per
year.
Consumption:
Americans eat approximately 18.5 lbs. of fresh apples annually, compared
to about 46 lbs. annually in many European countries.
Nutrition Value:
Apples are a healthy, delicious snack. In fact,
in a 1994 Fresh Trends produce survey,
apples were listed among the most nutritious
fruits by 62 percent of consumers surveyed.
Apples were also the number one choice of consumers
looking for dietary fiber and for
cancer prevention. Fresh Trends is done each
year by The Packer, a produce industry publication.
Apples are also considered healthy for what they don't have. An apple has just 80 calories, and is fat sodium free.
Produce:
Apples are one of the top volume items in the average supermarket produce
departments; ranks fourth behind potatoes, lettuce and bananas. Washington
has been the leading apple producing state since the 1910's.
Warehouses:
Approximately 125 warehouses pack and ship apples. These range in size
from those shipping two million boxes annually to less than 25,000 boxes.
The warehouses are either privately owned co-ops, which are owned by the
grower/members.
Fresh/Processed:
Washington sells approximately 75% of its apples fresh and 25% are
processed into juice, sauce or dehydrated products. Most other states send
less than 50% of their apples to the fresh market.
Pest:
Many kinds of plant and animal parasites attack apple trees and their
fruit. Three common diseases of the apple are scab, rust, and fire blight.
Scab makes black spots appear on leaves, blossoms, and twigs, and makes
the fruit cracked, poorly shaped, and knotted.
Scab is prevented by spraying the fruit. Rust is a fungus disease most common in the eastern half of the United States. It covers the leaves with orange spots and spoils the shape of the fruit. Fire blight is caused by bacteria. It kills the blossoms, leaves, and twigs, and gives them a scorched appearance.
Rust and fire blight are dealt with by planting the varieties of apples which are best able to resist them. Many of the insects that harm apples can be killed or prevented from multiplying by the use of pesticides sprayed on the trees.
Spraying large orchards is a costly remedy, but it is so necessary that it has become customary in regions where apple-growing is important. The caterpillar of the codling moth, one of the worst enemies of applegrowing, feeds on the core and seeds of the apple.
How apples are grown:
A seed from an apple will usually grow into a tree if it is planted
under satisfactory conditions. After a number of years the seeding tree
will bear apples of its own. Generally, these apples will be smaller and
poorer than the apple from which the seed was taken and may also be different
in other ways from all other varieties of cultivated apples.
For these reasons new apple trees are usually grown from buds. These buds are cut from a healthy apple tree which bears plenty of good apples of the kind the farmer wants. The buds are made to grow on strong roots of other apple trees by the process called budding. Budding is a kind of grafting. The apples these trees bear will be like the apples of the tree from which the twigs were cut. Budding permits the fruitgrower to have as many trees as he wishes, all bearing exactly the same variety of apples.
Once in a while, however, an apple tree grown from seed is better than the parent tree in some important way. When such a superior apple seedling is found, it may become the parent tree for a valuable new apple variety. Many of the thousands of varieties of cultivated apples began in this way.
Apple trees in orchards are usually planted in rows from thirty to forty feet apart each way. This spacing leaves room to spray and cultivate the orchards, and to harvest the fruit conveniently even after the trees have grown to full size.
The trees should be pruned from time to time so that they will develop
a rounded shape with branches fairly close to the ground. Apple trees that
are properly cared for will bear good crops for a long time. Many orchards
remain in fine condition for thirty years or more.
Relatives:
Among the closest relatives to apple trees are such well-known fruit
trees as those that bear pears, cherries, peaches and plums. All of those
trees, like apple trees themselves, are members of the rose family of plants.
Apple blossoms are much like wild-rose blossoms. The fruits of the rose and the apple are also much alike in form. But apples are much larger than the dry seedy fruits of the rose. Nearly 7,500 varieites of apples are grown around the world.
More than 7,000 of these varieties grow in the U.S. These varieties are very different in shape, size, color, flavor and other qualities. Ripe apples may be green or one of many shades of red, or yellow, or any combination of these colors. Some apples have hard, sour flesh and are usually cooked before eating. Other types are tender and have a mild flavor and are better for eating raw.
Use:
Most apples are eaten raw, but cooks also find many uses for them in
making jellies, pies, puddings, applesauce, and dumplings. Poor grades
of apples are dried or canned before they are sold, or their juice may
be made into cider.
Dried apples have a higher food value per pound than fresh apples do since the water has been removed. Yet fresh apples are a desirable food, for they are both delicious to the taste and helpful in promoting digestion.
Varieties:
The following apples are among the most popular varieties found in
American markets:
The Golden Delicious has an irregular oval shape, and is bright yellow, with darker specks and streaks. It is sweet, and generally is eaten raw or in salads. It is available from October until Spring. |
The Delicious is large and long, with six small knobs at the end of the apple opposite the stem. Its color is usually dark red, with darker stripes, although some are yellow.. It is sweet and usually eaten raw. The Delicious is on the market from October until Spring |
Like fine wine, its flavor improves with age. Fuji's spicy, crisp sweetness makes it excellent out of hand or as applesauce. Fuji varies from yellow-green with red highhlights to very red. |
Heart-shaped, distinctive yellow-orange skin with red striping. A crisp, sweet taste that can't be beat. Gala is the perfect take-along snack -any time of day. Great in salads. Available August through March. |
Mouthwatering tartness. Bright green Granny with a pink blush has a crisp bite and a tangy flavor. Its tartness really comes through when baked and sautéed. Enjoy Granny Smiths out of hand or in a salad. Available year round. |
The Jonathan is a medium-sized, very round apple, bright red and striped with yellow. The flesh is pleasantly tart, and is used either raw or cooked. The season is from September to December. |
II. Legal Clusters III. Geographic Clustersb. Geographic Site: Western North America
c. Geographic Impact: US
IV. Trade Clustersb. Indirectly Related to Product: NO
c. Not Related to Product: NO
d. Related to Process: Yes, habitat loss.
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Wenatchee/Yakima 94/95 Crop:
Number of Growers:
Rank:
Labor:
National Rank:
More than half of all fresh apples grown in the U.S. come from Washington.
Michigan and New York, the next ranking states, grow less than 1/3 as many
apples as Washington.
Mexico does not export apples to the U.S.
V. Environment Clusters|
The
Red Delicious is large and long, with six small knobs at the end of the
apple opposite the stem. Its color is usually dark red, with darker
stripes. It is very sweet and usually eaten raw. It can be
found on the markets from October unitl the spring. |
The
Golden Delicious has an irregular oval shape, and is bright yellow, with
darker specks and streaks. It is sweet, and generally it is eaten
raw or in salads. It has about the same season as the Red Delicious. |
VI. Other Factors