Canadian blueberries no threat to U.S. producers, embassy tells trade commission

WASHINGTON, D.C. — Canadian blueberry farmers and embassy officials pushed back Tuesday against claims that U.S. producers are being driven out of business by cheap imports from north of the border.

At the request of Trade Representative Robert Lighthizer, the U.S. International Trade Commission is investigating complaints about blueberry imports from several countries, including Mexico, Chile, Peru and Canada. 

The argument from Nadia Bourely, the Canadian Embassy’s minister-counsellor for economic and trade policy, boiled down to a simple premise: we’re not the problem. 

“We find it very difficult to see how blueberry imports, particularly imports from Canada, could have caused any injury to the U.S. blueberry industry,” Bourely told an online hearing.

Between 2015 and 2019, she said, U.S. imports from Canada grew by only 15 per cent, while total imports grew nearly 56 per cent. 

If anything, U.S. growers have benefited from accessing the Canadian market, said Bourely, who urged commissioners to consider each country’s impact in isolation, rather than lumping them together. 

“U.S. and Canadian producers are highly integrated and this integration has worked to the overwhelming benefit of the U.S. industry … the only real increase in trade flows between our countries has been northbound.”

Bourely acknowledged an isolated increase in 2019, which she attributed to a single multinational producer moving large quantities of frozen berries from its Canadian storage facilities to those in the United States.

“These were not ‘imports’ in any economic sense in 2019, but were internal movements by a company with operations on both sides of the border, with no sales to customers at the time of their movement,” she said. 

“As a result, not only do Canadian imports have appreciably lower rates of growth, in fact they have not grown at all.” 

Canadian berry growers have been girding for battle ever since October, when Lighthizer — long a champion of the protectionist instincts of President Donald Trump, who was at the time facing a difficult re-election fight — indicated he was planning to mobilize the commission. 

Lighthizer cited in particular the fact that U.S. farmers spent much of last year struggling to deal with the economic impact of the COVID-19 pandemic. 

Blueberry imports from Mexico appear to be the primary concern, particularly for southern producers. But Canadian producers have been caught in the squeeze — and singled out by farmers in northern states like Oregon and Michigan. 

Oregon producer Hugh Eisele objected to a “flood of imports” from Canada and Peru in recent years, which he said has undercut his businesses to the point where they no longer make money.

“Our problems are made worse by increasingly low (cost) imports from Canada,” where producers can take advantage of the lower Canadian dollar, Eisele told the hearing.

“Our costs are not much different from our Canadian counterparts, but the Canadian exporters are able to leverage exchange rates to undersell the market and kill the early and midseason prices.”

Rex Schultz, president of the Michigan Blueberry Advisory Committee, said shipments from Canada tend to enter the country without specific buyers already lined up. 

“Canadian farmers prioritize cash flow and are willing to send product to this market at what seems like any price, fresh or frozen,” Schultz said. 

“As a result, Canadian fruit — both fresh and frozen — keeps prices in the United States very low.”

Canadian producers who testified later Tuesday took issue with what they heard in the morning, particularly the idea that their products were being sold at a discount to U.S. buyers. 

At Oxford Foods Inc., a producer with operations in Nova Scotia, New Brunswick and Maine, the integration between the two countries is so deep that the border ceases to exist, said CEO Milton Wood. 

“With respect to frozen wild blueberries, the border between the United States and Canada is effectively ignored,” Wood said. 

“To each customer, for each type of wild frozen blueberry product, we charge the exact same price for our imports as we do for our U.S.-produced products.”

Canada also found a number of U.S. allies during Tuesday’s testimony. 

Agricultural trade experts and American producers with international operations insisted that imports have helped, not hindered, the domestic blueberry market in the United States.

Several attributed price pressure in recent years to the impact of higher domestic production in states like Washington and Michigan, as well as adverse weather in various growing regions of the country. 

And still others took issue with the commission’s efforts to survey growers about their concerns, noting a response rate of only about 10 per cent — a sign, they said, that the industry as a whole is not worried. 

They also noted that while roughly 98 per cent of Canadian blueberry exports go to the U.S., Canada remains the world’s single largest importer of American-grown blueberries by a wide margin. 

This report by The Canadian Press was first published Jan. 12, 2021.

James McCarten, The Canadian Press