TPP will help us sell fruit in Asia; politicians should help it pass

A recent U.S. International Trade Commission report confirms what the 98-year-old family-owned farming company I work for has known for decades: Opening export markets is a good thing, especially for the California fresh produce industry.

According to the ITC report, the Trans-Pacific Partnership agreement will increase U.S. fruit, vegetable and tree-nut exports by nearly $1 billion, or 8.3 percent.

Though this is a big number; we import $6 billion more in fresh produce than we export. So the U.S. still has a long way to go after TPP is enacted. But first, we need to get this agreement passed by Congress.

This is where our local representatives – Jeff Denham, Jim Costa and David Valadao – need to step in and help push the deal through the House. TPP will be a net positive for their constituents in farming communities up and down Highway 99, including my family’s own farming operations in Turlock and Firebaugh.

Turlock Fruit Company specializes in honeydews, cantaloupes and “mixed melon” varieties; we are one of the last California asparagus growers still in operation. All of our fruits and vegetables are carefully harvested and packed by hand, which requires a skilled workforce. With labor costs set to rise 50 percent over the next five years and ever-increasing water shortages (and costs), our business landscape will grow increasingly fraught with risk as our margins shrink.

To remain viable and profitable, we need a strategy to offset these perils. Foreign markets are a key part of our business plan.

Why?

During the summer harvest, I work with my 86-year-old grandfather-in-law, Don Smith, where we see first-hand the volatility of the U.S. fresh produce market. One adage is always true: When you are “long” on product (have excess supply), so are all of your competitors.

Fruits and vegetables are highly perishable, and farmers cannot simply store our inventory until supplies dwindle and markets improve. Instead, we need a sales strategy that includes the opportunity to export products to other countries.

However, exporting fresh produce carries significant risks. Our trading partners do not always play by the same rules as Americans. TPP will ensure that our trade happens in a fairer market with a more level playing field. All we want is the opportunity to compete.

TPP will promote “freer” trade in two important ways.

First, TPP will immediately eliminate many of the tariffs that make our produce prohibitively expensive overseas. For example, Vietnam currently levies a 15 percent duty on asparagus and 30 percent on melons. So, we don’t ship to Vietnam, nor do any of our domestic competitors. These tariff barriers will go away the day TPP goes into effect, opening a market for American fresh produce estimated to be worth over $700 million per year.

Second, TPP takes productive steps to ensure more scientifically based and consistently applied sanitary and phytosanitary measures. Put simply, every country reserves the right to ban imported fresh produce if it exceeds a certain threshold for pesticide residues or is found to contain unwanted pests or diseases. However, many countries use arbitrary thresholds as a barrier to trade, subjecting our exports to unnecessary inspections and delays, often leading to substantial losses.

Without TPP, the future of our export program will be in jeopardy, and we would likely reduce our plantings by hundreds of acres, leading us to lay off a significant number of seasonal employees in the field and packing shed.

This will also have an impact on many of our vendors: seed companies, fertilizer companies, trucking companies, equipment manufacturers. A decrease in acres affects more than just our bottom line – it ripples up and down the supply chain.

In short, we support TPP because it gives us the opportunity to compete in free and fair markets, making it more likely we’ll be able to keep the farm going long enough to give my son and daughter a chance to continue the family tradition for a fifth generation.

This story was originally published May 26, 2016 at 1:48 PM with the headline "TPP will help us sell fruit in Asia; politicians should help it pass."