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USTR Initiates Section 301 Digital Services Tax Investigations Covering India, the European Union and Several Other Countries

section 301

USTR Initiates Section 301 Digital Services Tax Investigations Covering India, the European Union and Several Other Countries

The Office of the U.S. Trade Representative (“USTR”) announced on June 2, 2020 that it is initiating Section 301 investigations on Digital Services Taxes (“DSTs”) adopted or under consideration by Austria, Brazil, Czech Republic, the European Union (“EU”), India, Indonesia, Italy, Spain, Turkey, and the United Kingdom (“U.K.”). The Section 301 DST investigations could lead the U.S. to impose new punitive tariffs and could significantly raise global trade tensions.

USTR is soliciting public comments from parties and these must be submitted no later than July 15, 2020. Written comments should be submitted through the Federal eRulemaking Portal at http://www.regulations.gov under docket number USTR-2020-0022. According to the Federal Register notice, the USTR invites comments with respect to:

-Concerns with one or more of the DSTs adopted or under consideration by the jurisdictions covered in these investigations.

-Whether one or more of the covered DSTs is unreasonable or discriminatory.

-The extent to which one or more of the covered DSTs burdens or restricts U.S. commerce.

-Whether one or more of the covered DSTs is inconsistent with obligations under the WTO Agreement or any other international agreement.

-The determination required under section 304 of the Trade Act, including what action, if any, should be taken.

Over the last couple of years, various governments have enacted or considered taxes on revenues generated by companies from providing digital services within those jurisdictions. While the proponents of DSTs argue that the tax corrects corporate taxation to cover previously untaxed or undertaxed revenues, the position of the Trump administration, including the USTR, is that DSTs unfairly discriminate against “large, U.S.-based tech companies” such as Amazon and Google. USTR’s announcement provides a brief but detailed overview of the current status of each of the named jurisdictions’ enacted or proposed DSTs.

USTR’s initiation of Section 301 investigations follow a period of intermittent tensions between the U.S. and some of its trading partners over proposed DSTs. In December 2019, the U.S. and France nearly began a trade war over the DST adopted by France, which USTR described as “unreasonable, discriminatory, and burdensome on U.S. commerce.” However, these tariffs were never implemented on imports of products from France. In January of this year, the Trump administration had also threatened the U.K. with tariffs on imports of British cars if the U.K. pressed forward with its DST.

A possible result of these new investigations will be the institution of additional tariffs on imports of products from each of the named countries but that remains to be seen and will depend in large part on the support or opposition to the institution of trade remedies in the comments filed on the record of these investigations.

Husch Blackwell continues to monitor the Section 301 investigations on Digital Services Taxes and will provide further updates as more information becomes available. We encourage clients and companies to review the USTR’s announcement and Federal Register notice.

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Nithya Nagarajan is a Washington-based partner with the law firm Husch Blackwell LLP. She practices in the International Trade & Supply Chain group of the firm’s Technology, Manufacturing & Transportation industry team.

Grant Leach is an Omaha-based partner with the law firm Husch Blackwell LLP focusing on international trade, export controls, trade sanctions and anti-corruption compliance.

Cortney O’Toole Morgan is a Washington D.C.-based partner with the law firm Husch Blackwell LLP. She leads the firm’s International Trade & Supply Chain group.

Camron Greer is an Assistant Trade Analyst in Husch Blackwell LLP’s Washington D.C. office.

global tea

Global Tea Market Overcame $25B, Growing Robustly Over the Last Decade

IndexBox has just published a new report: ‘World – Tea – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The global tea market revenue amounted to $25.9B in 2018, picking up by 7.7% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). Overall, the total market indicated a strong growth from 2007 to 2018: its value increased at an average annual rate of +4.3% over that period. Global tea consumption peaked in 2018 and is likely to continue its growth in the immediate term.

Consumption By Country

China (2.3M tonnes) constituted the country with the largest volume of tea consumption, comprising approx. 35% of total volume. Moreover, tea consumption in China exceeded the figures recorded by the second-largest consumer, India (1.1M tonnes), twofold. Turkey (258K tonnes) ranked third in terms of total consumption with a 3.9% share.

From 2007 to 2018, the average annual growth rate of volume in China amounted to +9.2%. In the other countries, the average annual rates were as follows: India (+2.7% per year) and Turkey (+1.6% per year).

In value terms, China ($10.7B) led the market, alone. The second position in the ranking was occupied by India ($3.4B). It was followed by Turkey.

The countries with the highest levels of tea per capita consumption in 2018 were Kenya (4,903 kg per 1000 persons), Turkey (3,164 kg per 1000 persons) and Viet Nam (2,663 kg per 1000 persons).

Market Forecast 2019-2025

Driven by increasing demand for tea worldwide, the market is expected to continue an upward consumption trend over the next decade. Market performance is forecast to decelerate, expanding with an anticipated CAGR of +2.9% for the period from 2018 to 2030, which is projected to bring the market volume to 9.3M tonnes by the end of 2030.

Production 2007-2018

Global tea production totaled 6.7M tonnes in 2018, surging by 5.5% against the previous year. The total output volume increased at an average annual rate of +4.3% over the period from 2007 to 2018; however, the trend pattern indicated some noticeable fluctuations being recorded in certain years. The general positive trend in terms of tea output was largely conditioned by a strong expansion of the harvested area and a relatively flat trend pattern in yield figures.

Production By Country

The countries with the highest volumes of tea production in 2018 were China (2.7M tonnes), India (1.4M tonnes) and Kenya (740K tonnes), together accounting for 71% of global production.

From 2007 to 2018, the most notable rate of growth in terms of tea production, amongst the main producing countries, was attained by China, while tea production for the other global leaders experienced more modest paces of growth.

Harvested Area 2007-2018

In 2018, approx. 4.2M ha of tea were harvested worldwide; picking up by 4% against the previous year. The harvested area increased at an average annual rate of +3.6% over the period from 2007 to 2018, which largely made the strong growth of tea production feasible.

Yield 2007-2018

In 2018, the global average tea yield stood at 1.6 tonne per ha, stabilizing at the previous year. Over the period under review, the tea yield continues to indicate a relatively flat trend pattern.

Exports 2007-2018

In 2018, the global tea exports stood at 2M tonnes, increasing by 4.1% against the previous year. The total export volume increased at an average annual rate of +1.4% over the period from 2007 to 2018; the trend pattern remained consistent, with only minor fluctuations throughout the analyzed period. In value terms, tea exports stood at $8.4B (IndexBox estimates) in 2018.

Exports by Country

The exports of the four major exporters of tea, namely Kenya, China, Sri Lanka and India, represented more than two-thirds of total export. The following exporters – Viet Nam (77K tonnes), Argentina (74K tonnes), Indonesia (49K tonnes), Malawi (43K tonnes) and the United Arab Emirates (34K tonnes) – together made up 14% of total exports.

From 2007 to 2018, the most notable rate of growth in terms of exports, amongst the main exporting countries, was attained by India, while exports for the other global leaders experienced more modest paces of growth.

In value terms, China ($1.7B), Sri Lanka ($1.6B) and Kenya ($1.4B) appeared to be the countries with the highest levels of exports in 2018, together accounting for 56% of global exports.

Export Prices by Country

The average tea export price stood at $4,134 per tonne in 2018, going up by 3.3% against the previous year. Over the period from 2007 to 2018, it increased at an average annual rate of +3.6%.

There were significant differences in the average prices amongst the major exporting countries. In 2018, the country with the highest price was the United Arab Emirates ($8,419 per tonne), while Argentina ($1,254 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of export prices was attained by China, while the other global leaders experienced more modest paces of growth.

Imports 2007-2018

In 2018, the amount of tea imported worldwide amounted to 2M tonnes, rising by 3.6% against the previous year. The total import volume increased at an average annual rate of +1.4% from 2007 to 2018; the trend pattern remained relatively stable, with somewhat noticeable fluctuations in certain years. In value terms, tea imports amounted to $7.7B (IndexBox estimates) in 2018.

Imports by Country

The imports of the twelve major importers of tea, namely Pakistan, Russia, the UK, the U.S., Egypt, Iran, the United Arab Emirates, Viet Nam, Germany, Saudi Arabia, Iraq and Poland, represented more than half of total import.

From 2007 to 2018, the most notable rate of growth in terms of imports, amongst the main importing countries, was attained by Viet Nam (+50.2% per year), while imports for the other global leaders experienced more modest paces of growth.

In value terms, Pakistan ($570M), Russia ($497M) and the U.S. ($487M) appeared to be the countries with the highest levels of imports in 2018, with a combined 20% share of global imports. The UK, Iran, Egypt, Saudi Arabia, the United Arab Emirates, Germany, Iraq, Viet Nam and Poland lagged somewhat behind, together comprising a further 31%.

Import Prices by Country

In 2018, the average tea import price amounted to $3,878 per tonne, jumping by 1.9% against the previous year. Over the last eleven years, it increased at an average annual rate of +3.3%.

There were significant differences in the average prices amongst the major importing countries. In 2018, the country with the highest price was Saudi Arabia ($6,921 per tonne), while Viet Nam ($2,062 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of import prices was attained by Egypt, while the other global leaders experienced more modest paces of growth.

Source: IndexBox AI Platform

supplies

FREE TRADE IN MEDICINES AND SUPPLIES IS THE HEALTHIEST APPROACH

What Does Trade Have to Do with the Pandemic?

pandemic is a type of epidemic, wherein an outbreak of a disease not only affects a high proportion of the population at the same time, but also spreads quickly over a wide geographic area.

As the novel coronavirus jumped continents, governments in countries yet unaffected or with low incidence rates moved to prevent “importing” the virus through individual travel. Simultaneously, governments acted to create diagnostic kits and treatments for those with the virus – all praise our frontline healthcare workers.

Unfortunately, what could worsen the situation is a policy practice that seems to be infectious. More than 20 governments are banning the export of needed supplies, a prescription for shortages and higher prices. What the crisis also lays bare is that key countries and many important healthcare products remain outside a WTO agreement that would otherwise enable duty-free trade in the medicines and supplies we need on a regular basis.

Pandemic Proportions

In the history of pandemics, there has been none more deadly than the infamous Bubonic Plague which took 200 million lives in the mid-14th century, wiping out half the population on the European Continent. The pathogen spread through infected fleas carried by rodents, frequent travelers on trading ships. The practice of quarantine began in the seaport of Venice, which required any ships arriving from infected ports to sit at anchor for 40 days — quaranta giorni — before landing. Two centuries later, Small Pox took 56 million lives. In the modern era, some 40 to 50 million succumbed to the Spanish Flu of 1918 and HIV/AIDS has claimed 25-35 million lives since 1981.

For perspective, and not to minimize its severe toll, the number of fatalities from novel coronavirus will likely exceed 10,000 by the time of this writing. COVID-19, as it is currently known, is a reminder that we live with the ongoing threat from many types of both known infectious diseases like cholera, Zika and Avian flu, as well as diseases yet unknown to us. Although we can more rapidly detect, contain and treat epidemics, diseases now travel at the speed of a person on board an international flight. Our cities are bigger and denser, further enabling rapid transmission.

Pandemic Prepping Includes Trade

Because we are interconnected, we share the health risks, but we can also problem-solve as a global community. Scientists in international labs share insights to identify viruses, swap guidance on how to conduct confirmatory tests, and quickly communicate best practices for containment.

Outside times of crisis, global trade in health-related products and services has laid the foundation for faster medical breakthroughs through international research and development projects, and by diversifying the capability to produce medical supplies, devices, diagnostics and pharmaceuticals.

Innovation thrives in the United States like nowhere else. Yet, no single country, not even the United States, can discover, produce and distribute diagnostics, vaccines and cures for everything that ails us — or invent every medical intervention that improves the productivity and quality of our lives.

One Quarter of medicines have tariffs

A Dose of Foresight

As the Uruguay Round of multilateral trade negotiations were drawing to a close in 1994, a group of countries representing (at the time) 90 percent of total pharmaceutical production came to an agreement. Each government would eliminate customs duties on pharmaceutical products and avoid trade-restrictive or trade-distorting measures that would otherwise frustrate the objective of duty-free trade in medicines.

The WTO’s Pharmaceutical Tariff Elimination Agreement, which entered into force on January 1, 1995, is known as a “zero-for-zero initiative” to eliminate duties reciprocally in a particular industrial sector. Signed onto over subsequent years by the United States, Europe’s 28 member states, Japan, Canada, Norway, Switzerland, Australia and handful of others, the agreement initially covered approximately 7,000 items that included formulated or dosed medicines, medicines traded in bulk, active pharmaceutical ingredients (APIs) and other chemical intermediaries in finished pharmaceuticals.

Signatories agreed to expand the list in 1996, 1998, 2006 and 2010 so it now covers more than 10,000 products. Tariffs were eliminated on a most-favored-nation basis, meaning it was extended to imports from all WTO members, not just parties to the agreement.

Maintenance Drugs

Though an important start, the agreement has not been updated in a decade. Trade in products covered by the WTO agreement has risen from $1.3 trillion in 2009 to $1.9 trillion in 2018. Yet, some 1,000 finished products and 700 ingredients are not covered under the agreement, leaving pharmaceutical trade subject to hundreds of millions in customs duties. With China and India increasing manufacturing over the last decade, the value of global trade included in duty-free treatment decreased from 90 percent in 1995 to 81 percent in 2009 to 78 percent in 2018.

It is challenging to chart trade statistics and tariffs on health-related products, particularly since many chemical ingredients have both medical and non-medical uses. Here we have attempted to reproduce tables developed by the WTO in 2010, but we do not include a large number of chemicals that have general use whose tariff lines were not enumerated in the WTO’s analysis.

Health Product Import Shares

In 2010, the European Union and the United States together accounted for almost half of all world imports of health-related products. Europe has become a much larger importer while U.S. imports have decreased slightly as a percentage of global imports. Imports by many big emerging markets including Brazil, Mexico, China, India and Turkey, have increased along with their purchasing power. These countries benefit from zero duties when importing from countries that signed on to the WTO Pharmaceutical Trade Agreement.

Health Product Export Shares

On the export side, Europe dramatically increased its share of global exports while the United States dropped across the board compared to 2010, particularly in medical products and supplies. China shows significant growth in exports of inputs specific to the pharmaceutical industry – including antibiotics, hormones and vitamins – as well as medical equipment including diagnostic reagents, gloves, syringes and medical devices. India also increased its exports of all types of pharmaceuticals, particularly ingredients, but did not drive up its share across all types of exported health-related products. China and India would benefit from zero duties without having to reciprocate for exports from countries that signed on to the WTO agreement.

That said, according to the trade data, China and India still only account for 5.4 percent of global exports in health-related products covered by the agreement. Therefore, simply expanding membership to include these countries is not sufficient to enlarge duty-free trade – the number of tariff lines covered by the agreement would also need to expand to capture a significant portion of traded healthcare products.

Emerging Market Pharm Trade

Tariffs as a Symptom

The final price of a pharmaceutical is determined by many factors that differ by country. Costs and markups occur along the distribution chain from port charges to warehousing, to local government taxes, distribution charges, and hospital or retailer markups. Tariffs may seem a relatively small component of the final price, but the effect is compounded as all of these “internal” costs accumulate and they are symptomatic of complex regulatory systems.

A 2017 study by the European Centre for International Political Economy determined that tariffs on final prices add an annual burden of up to $6.2 billion in China. In Brazil and India, tariffs on medicines may increase the final price by up to 80 percent of the ex-factory sales price. Imported pharmaceuticals are at a clear disadvantage and patients bear the burden in cost and diminished availability.

Side Effects

According to the U.S. International Trade Commission, the U.S. pharmaceutical industry historically shipped bulk APIs from foreign production sites to the United States before formulating into dosed products. After the WTO agreement, it became viable to import more finished products duty-free. Over the years, a failure to add more APIs to the duty-free list reinforced this trend. The U.S. Food and Drug Administration also allows firms to import formulated products prior to receiving marketing approval to prepare for a new product launch but does not allow bulk API importation before market approval.

The urgency to accrue adequate supplies and treatments for COVID-19 has reignited a debate on U.S. over-reliance on China and India for antibiotics, among other medicines. What if factories must close? What if China and India withhold supplies? If raw materials and ingredients are derived in those countries, would the United States be able to ramp up domestic production? The White House is considering incentives and Buy America government procurement requirements to stimulate demand for U.S. production and in the meanwhile has temporarily reduced tariffs on medical supplies such as disposable gloves, face masks and other common hospital items from China.

20 Countries Ban Medical Exports

A Cure Worse Than the Disease

Removing barriers to trade in essential products is a healthier approach than imposing restrictions that could exacerbate potential shortages.

Nonetheless, some 20 countries have announced a ban on the export of medical gear – masks, gloves, and protective suits worn by medical professionals. They include Germany, France, Turkey, Russia, South Korea, India, Taiwan, Thailand and Kazakhstan.

Governments generally do maintain national stocks of critical items to enable manufacturers to ramp up production in cases of health emergencies or address unexpected gaps in their supply chains. But when major producers withhold global supply, importing countries face shortages and higher prices. Dangerously, India’s trade restrictions go beyond medical gear to restrict export of 26 pharmaceutical ingredients. India, however, relies heavily on APIs imported from China for their medicines, much of it originating from factories in Hubei province where the outbreak emerged.

Bans tend to beget more bans, potentially wreaking havoc on pharmaceutical and medical product supply chains, making it more difficult for healthcare workers to stem spread of the virus. Poorer countries with already fragile and underfunded healthcare systems are left in an even more vulnerable position.

A Test for Public-Private Collaboration

Instead of export restrictions, governments can expedite purchase orders and otherwise support industry efforts to ramp up production for domestic and global use. Most global manufacturers are operating at several times their usual capacity since the initial outbreak in China. Private labs are utilizing high-throughput platforms to conduct more tests faster but require trade in the chemical reagents needed to start up and run the tests.

Biopharmaceutical firms are applying their scientific expertise to accelerate the development of a vaccine and treatments for COVID-19. They are reviewing their research portfolios, investigating previously approved medicines that have potential to treat the virus, and donating approved investigational medicines to the global research effort. Internationally, scientists are collaborating through a Norway-based nonprofit called the Coalition for Epidemic Preparedness Innovations on COVID-19 vaccine development. They know that the more options, the better – most drug candidates will not get through all three phases of clinical trials.

Recovery

Epidemic diseases evolve and they do not respect borders. Treating them, as well as the myriad chronic diseases and other ailments that affect us more routinely, requires new and adapted medical technologies arising from innovation made widely available through trade.

While there’s nothing inherently wrong with providing incentives to encourage domestic production, it should not come at the expense of free trade in health-related products. Tariffs should be eliminated on life-saving medicines and their ingredients. Governments must impose restrictions on exports temporarily and only when absolutely necessary. In this way, openness in trade will help promote the recovery of both our health and our economies.

Many thanks to economist and contributor Alice Calder for running all the trade numbers in this article. Full data tables may be accessed here.

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Andrea Durkin is the Editor-in-Chief of TradeVistas and Founder of Sparkplug, LLC. Ms. Durkin previously served as a U.S. Government trade negotiator and has proudly taught international trade policy and negotiations for the last fifteen years as an Adjunct Professor at Georgetown University’s Master of Science in Foreign Service program.

Alice Calder

Alice Calder received her MA in Applied Economics at GMU. Originally from the UK, where she received her BA in Philosophy and Political Economy from the University of Exeter, living and working internationally sparked her interest in trade issues as well as the intersection of economics and culture.

This article originally appeared on TradeVistas.org. Republished with permission.

america

AMERICA’S FAVORITE HOG IS DRIVING U.S.-INDIA TRADE RELATIONS

American Icon in a Global Market

A couple of years ago, the Fat Boy Arnold Schwarzenegger rode in Terminator 2 sold at auction for more than half a million dollars. The bike’s on-screen presence with Arnold cruising in a black leather jacket and Italian Persol sunglasses fueled a run on the bike back in the early 1990s. Maker Harley-Davidson just released a 30th anniversary limited edition Fat Boy.

Harley-Davidson bikes have been an American icon for more than 100 years. With a classic foundation story, starting out of a small shed in Milwaukee, Wisconsin in 1903, the company and its bikes are a stand-in for the American ideal of freedom and strength, its brand recognizable across the world. Harley-Davidson weathered the Great Depression, two World Wars and the financial tsunami in 2008 to emerge as a “great American company,” as noted by U.S. President Donald Trump in 2017.

The company is focused on nurturing a new generation of riders who include young, female — and global — enthusiasts. Expanding its portfolio of motorcycle offerings for global appeal, it has set a goal to grow its international business to 50 percent of annual revenue by 2027.

Harley global sales

Taken for a Tariff Ride

Harley-Davidson bikes enjoy a well-earned prestigious reputation around the world and the price tag reflects it. Adding to its price, many countries also impose high tariffs on imported two-wheelers. In fast-growing Asia, tariffs range from 20 percent in Taiwan to 30 percent in China, 60 percent in Thailand, and 100 percent until recently in India.

Facing a declining U.S. consumer base and eyeing growing markets in Asia, Harley-Davidson is working to expand its sales particularly in South and Southeast Asia. U.S. tariffs have thrown a monkey wrench into those plans.

Here at home, the Trump administration’s tariffs on imported steel and aluminum would add some $40 million in domestic production costs, according to the company. Making matters worse, the European Union retaliated by increasing the tariffs on U.S. motorcycles from 6 percent to 31 percent, adding an average $2,200 to the cost of a Harley-Davidson bike exported to Europe. If the steel tariff dispute isn’t resolved, Europe has threatened to raise the tariff in 2021 to 56 percent.

Harley-Davidson, like so many other companies, hastened production expansion in overseas plants to mitigate costs from the tariff war, a strategy the company undertook in India more than a decade ago.

The Largest Motorcycle Market in the World

India‘s auto industry is regarded as one of the fastest-growing in the world. In 2018, India produced over 29 million vehicles (including passenger vehicles, commercial vehicles, three-wheelers and two-wheelers).

The two-wheeler category leads the Indian automobile market with 80 percent market share due to a growing middle class and a young population. India is now both the largest two-wheeler consumer market and the largest manufacturer of two-wheelers in the world. There are an estimated 170 million motorcycles, scooters and mopeds on the roads today in India. But until 2007, Harley-Davidson was denied access to the Indian market.

Size of India's Motorcycle Market

Mangoes for Motorcycles

In 2007, President George W. Bush struck the so-called “mango deal” with India, which allowed Harley-Davidson to sell its bikes in India in exchange for the end to an 18-year-ban on imports of Indian mangoes to the United States. The deal was signed a year later by then-U.S. Trade Representative Susan Schwab and Union Commerce and Industry Minister Kamal Nath.

The mango deal allowed Harley to invest in India and permitted imports of Harley-Davidson bikes with an engine capacity of 800 cc or above if it complied with Euro-III emission norms. But India remained firm it would not lower its 100 percent tariff on motorcycle imports, which continued to deny Harley-Davidson effective access to the Indian market for its bikes completely built in the United States.

In August 2009, Harley-Davidson announced plans to enter the market in India through a subsidiary and started assembly operations in 2011 in a plant located in in Bawal in Haryana state using parts imported from the United States. Through a complicated tax system, imported motorcycle parts face around a 39 percent tariff. India-built Harley-Davidson motorcycles are also exported to Europe and Asia.

Too Much for Trump

Whether standing on the factory floor in Wisconsin or making a State of the Union speech, President Trump frequently complains about India’s 100 percent tariff on Harley-Davidson bikes as a sticking point in U.S-India trade relations.

In February 2018, the Indian government responded by lowering the custom duty on fully-built imported motorcycles from 100 percent to 50 percent. However, since Harley-Davidson assembles 12 out of its 16 models in India for domestic consumption, most of its bikes won’t be subject to the 50 percent tariff either.

In a media interview with an Indian newspaper, Peter MacKenzie, Managing Director of India & Greater China for Harley-Davidson was quoted saying, “We don’t see any significant impact. Yes, there is a reduction in custom and any cut is always welcome. However, a large portion of our portfolio is locally produced.”

Beyond trade wars and tariffs, one of Harley-Davidson’s biggest issues is consumer preferences for smaller and cheaper motorcycles in Asian markets like India. The company plans to develop a more accessible, small-displacement motorcycle (250cc to 500cc) to increase sales in India and other Asian markets, but for now the country’s vast middle-income group generally prefers less expensive bikes that sell for between $1,000 and $1,500, about eight times less than a Harley-Davidson. The smaller bikes are more adept at navigating narrow, pot-holed streets choked with thousands of other bikes.
Harley-Davidson Sales in India

Big Hog, Small Trade Deal

President Trump is scheduled to go to India at the end of February and he wants to sign a trade deal with India’s Prime Minister Modi. Right now, the deal appears narrowly focused on addressing U.S. complaints regarding lack of access for the U.S. dairy and medical technology industries in exchange for the U.S. restoring India’s tariff benefits under the U.S. Generalized System of Preferences and removing India from countries hit by U.S. tariffs on aluminum and steel.

India might also ratchet back the tariff hike it imposed last year on high-value farm imports such as almonds, walnut, apples, and wine, among 29 other items.

As in Terminator 2, next week is judgment day. If Modi says “Hasta la vista, baby“ to President Trump’s request to eliminate or lower the tariff on Harley-Davidson motorcycles, Trump is likely to say, ”I’ll be back.“

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PBhatnagar

Pragya Bhatnagar is a Research Associate with the Hinrich Foundation where he focuses on International Trade Research. He is a Hinrich Foundation Global Trade Leader Scholar alumnus, earning his Master’s degree in International Journalism, specializing in Business and Financial Journalism, from Hong Kong Baptist University. He received his bachelor’s degree in Economics from Lucknow University, India.

This article originally appeared on TradeVistas.org. Republished with permission.
steel

Commerce Finds Dumping and Countervailable Subsidization of Imports of Carbon and Alloy Steel Threaded Rod from China and India

On February 10, 2020, the Department of Commerce (“Commerce”) announced its affirmative final determinations in the AD and CVD investigations of imports of carbon and alloy steel threaded rod from China and India. See the fact sheet for a summary of the final cash deposit rates and margins.

In the China AD investigation, Commerce calculated cash deposit rates of 4.26% and 14.16% to the mandatory respondents Zhejiang Junyue Standard Part Co., Ltd. and Ningbo Zhongjiang High Strength Bolts Co., Ltd., respectively. Chinese companies that are eligible for a separate rate received a rate of 11.47%. The antidumping cash deposit rate for all other Chinese companies is 59.45%.

In the China CVD investigation, Commerce calculated and assigned subsidy rates of 66.81% and 31.02% to the mandatory respondents Zhejiang Junyue Standard Part Co., Ltd. and Ningbo Zhongjiang High Strength Bolts Co., Ltd., respectively. The subsidy rate for all other Chinese exporters is 41.17%.

In the India AD investigation, Commerce assigned a cash deposit rate of 28.34% to mandatory respondent Daksh Fasteners and 2.47% for mandatory respondent Mangal Steel Enterprises Limited. The cash deposit rate for all other Indian exporters is 2.47%.

In the India CVD investigation, Commerce assigned a cash deposit rate of 211.72% to mandatory respondent Daksh Fasteners and a rate of 6.07% to mandatory respondent Mangal Steel Enterprises Limited. The cash deposit rate for all other Indian exporters is 6.07%.

The ITC is currently scheduled to make its final determinations on or about March 23, 2020. If the ITC makes affirmative final determinations of material injury to domestic industry, then Commerce will issue AD and CVD orders instructing Customs and Border Protection (“CBP”) to collect deposits based on the applicable duty rate. If the ITC makes negative determinations of injury, then the investigations will be terminated.

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Nithya Nagarajan is a Washington-based partner with the law firm Husch Blackwell LLP. Shee practices in the International Trade & Supply Chain group of the firm’s Technology, Manufacturing & Transportation industry team.

Camron Greer is an assistant trade analyst in Husch Blackwell LLP’s Washington, D.C. office.

Global Cinnamon Market 2019 – Imports to India Grow Robustly

IndexBox has just published a new report: ‘World – Cinnamon (Canella) – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The global cinnamon market revenue amounted to $1.1B in 2018, dropping by -9% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). In general, the total market indicated a remarkable expansion from 2007 to 2018: its value increased at an average annual rate of +2.0% over the last eleven years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, the cinnamon consumption decreased by -19.8% against 2014 indices. The pace of growth appeared the most rapid in 2010, when the market value increased by 36% y-o-y. Global cinnamon consumption peaked at $1.3B in 2014; however, from 2015 to 2018, consumption failed to regain its momentum.

Production 2007-2018

Global cinnamon production totaled 237K tonnes in 2018, going up by 4% against the previous year. The total output volume increased at an average annual rate of +1.7% from 2007 to 2018; the trend pattern remained relatively stable, with only minor fluctuations being recorded throughout the analyzed period.

Exports 2007-2018

In 2018, approx. 145K tonnes of cinnamon (canella) were exported worldwide; declining by -18.1% against the previous year. In general, the total exports indicated a moderate increase from 2007 to 2018: its volume increased at an average annual rate of +2.2% over the last eleven year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. In value terms, cinnamon exports totaled $580M (IndexBox estimates) in 2018. Over the period under review, cinnamon exports, however, continue to indicate a remarkable expansion. The pace of growth was the most pronounced in 2011, when exports increased by 33% against the previous year. Over the period under review, global cinnamon exports reached their peak figure at $605M in 2017, and then declined slightly in the following year.

Exports by Country

In 2018, Viet Nam (44K tonnes) and Indonesia (41K tonnes) were the major exporters of cinnamon (canella) around the world, together accounting for near 59% of total exports. It was distantly followed by China (25K tonnes) and Sri Lanka (17K tonnes), together creating 29% share of total exports. The Netherlands (5.2K tonnes), Madagascar (2.7K tonnes) and the U.S. (2.3K tonnes) followed a long way behind the leaders.

From 2007 to 2018, the most notable rate of growth in terms of exports, amongst the main exporting countries, was attained by Madagascar, while the other global leaders experienced more modest paces of growth.

In value terms, the largest cinnamon markets worldwide were Sri Lanka ($191M), Indonesia ($141M) and Viet Nam ($118M), together accounting for 78% of global exports. These countries were followed by China, the Netherlands, the U.S. and Madagascar, which together accounted for a further 15%.

Export Prices by Country

The average cinnamon export price stood at $4,003 per tonne in 2018, surging by 17% against the previous year. Over the period under review, the export price indicated a remarkable increase from 2007 to 2018: its price increased at an average annual rate of +7.7% over the last eleven years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, the cinnamon export price increased by +104.6% against 2010 indices. There were significant differences in the average export prices amongst the major exporting countries. In 2018, the country with the highest export price was Sri Lanka ($11,358 per tonne), while China ($1,843 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of export prices was attained by Indonesia, while the other global leaders experienced more modest paces of growth.

Imports 2007-2018

In 2018, the global cinnamon imports stood at 167K tonnes, lowering by -4.7% against the previous year.In value terms, cinnamon imports stood at $587M (IndexBox estimates) in 2018.

Imports by Country

In 2018, India (39K tonnes), distantly followed by the U.S. (20K tonnes), Mexico (11K tonnes) and the Netherlands (7.7K tonnes) were the key importers of cinnamon (canella), together making up 47% of total imports. Bangladesh (7K tonnes), Saudi Arabia (5.5K tonnes), the United Arab Emirates (4.6K tonnes), Pakistan (4.4K tonnes), Iran (3.9K tonnes), Brazil (3.2K tonnes), Germany (3K tonnes) and Viet Nam (3K tonnes) held a relatively small share of total imports.

From 2007 to 2018, the most notable rate of growth in terms of imports, amongst the main importing countries, was attained by Viet Nam, while the other global leaders experienced more modest paces of growth.

In value terms, the largest cinnamon importing markets worldwide were Mexico ($97M), India ($84M) and the U.S. ($72M), together accounting for 43% of global imports. The Netherlands, Bangladesh, Germany, Brazil, Saudi Arabia, the United Arab Emirates, Viet Nam, Pakistan and Iran lagged somewhat behind, together accounting for a further 17%.

Import Prices by Country

The average cinnamon import price stood at $3,510 per tonne in 2018, surging by 3.6% against the previous year. Over the period under review, the import price indicated a remarkable increase from 2007 to 2018: its price increased at an average annual rate of +6.8% over the last eleven year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, the cinnamon import price increased by +39.1% against 2013 indices. Import prices varied noticeably by the country of destination; the country with the highest import price was Mexico ($8,610 per tonne), while Bangladesh ($1,717 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of import prices was attained by Brazil, while the other global leaders experienced more modest paces of growth.

Source: IndexBox AI Platform

India

INDIA TARIFFS COULD DENT GAINS FROM CALIFORNIA’S BUMPER ALMOND CROP

Celebrating Diwali in India with California almonds

Fall festivals and the wedding season are already ramping up in India. There’s Janmashtami which celebrates the birth of Lord Krishna, the festival for Lord Ganesha, the elephant-headed God of the Hindus, and Diwali, the famously elegant festival of lights, and many more throughout the various regions of India. Almonds are a popular gift for such occasions.

The timing is perfect for California’s almond growers. Across California’s lush green valleys, almonds are being harvested from orchards, loaded on trucks and delivered to mills where the essential nut will be separated from its shell and hull. Almond traders in India await the arrival of the best quality shipments for the festival season demand beginning early September.

Almonds have deep roots in India

Almonds in India date as far back as prehistoric times. Ancient Indian Sanskrit texts on Ayurveda, the Indian traditional medicine, detail the role of almonds and other nuts in providing health benefits. Almonds were exclusive and prestigious health supplements for the rich and royal during the Mughal rule from the 15th to the 19th century.

To this day, consuming raw almonds on a daily basis as a standalone morning chew, added to milk shakes, as oils or as a garnish to dishes, is widely prevalent in India and elsewhere on the sub-continent.

Indian consumers choose from types of almonds available in Indian street markets and grocery stores – Mamra, Gurbandi and California almonds. California almonds command a majority market share due to its wide availability and lower price. Sweeter in taste, California almonds are favored in Indian cooking and garnishing.

Tariffs could dampen California’s bumper crop

California produces 80 percent of the world’s almonds. Americans consume just over a third of California’s harvest. The remaining 67 percent is exported to other countries. California almond growers are on track for a bumper crop this year, producing a record 2.5 billion pounds of almonds, which would be a nine percent increase of over last year’s crop.

TradeVistas- Global almond production

California growers have reason to worry about access to one of their biggest export markets. The Indian government increased tariffs on U.S. shelled almonds by 20 percent and non-shelled almonds by 17 percent in June. The move came days after the Trump administration announced plans to remove India from eligibility for key trade privileges under the U.S. Generalized System of Preference (GSP) program. India was the biggest beneficiary under the GSP program, exporting $5.6 billion worth of Indian products to the United States duty-free in 2017.

The latest tariff increase by India comes on top of an increase in customs duties last year and in addition to a 12 percent tax the Indian Ministry of Finance imposes on both domestic and imported almonds. The U.S. Department of Agriculture forecasts the increased cost will cause a five percent drop in U.S. almond exports to India, impacting the 6,800 almond growers in California, who are mostly small to medium-size, family-run enterprises.

According to a study by the Almond Board of California, the almond industry generates more than 100,000 jobs in California, mostly in the Central Valley. Almond growers are California contribute about $11 billion annually to the state’s economy.

“Tomorrow Begins Today”

India has become such an important market for California almond growers that the state almond board has an office in New Delhi with a $5.5 million annual budget.

In July of 2015, the Almond Board of California launched a successful marketing campaign in India, promoting the lesser-known nutrition benefits of almonds such as heart health, weight management and diabetes management.

The campaign, called “Tomorrow Begins Today,” reached 4.05 billion broadcast impressions and is credited with helping grow the snack category by 100 percent.

TradeVistas- Export destinations for U.S. almonds

Tariffs are a tough nut to crack

In the face of new tariffs and competition from Vietnam, Hong Kong, Australia and Chile, California growers need to crack open new markets.

Unfortunately, the tariff wars are being fought in another of California’s important export markets – China. In 2018, China imposed a 50-percent retaliatory tariff on almond imports from the United States. U.S. exports declined by 33 percent from August 2018 to April 2019 compared with the same period of the prior year, according to Almond Board of California.

Higher tariffs could ultimately cost major U.S. fruit and nut industries over $2.6 billion per year in exports, according to a report by Daniel A. Sumner, an economist with the University of California Davis’ Department of Agricultural and Resource Economics. The economic blow could rise to as much as $3.3 billion because of lost market share overtaken by lower-priced alternatives from competing exporters.

Australia has taken advantage of their free trade agreement with China to expand exports. The free trade agreement between the two countries grants zero tariffs on almonds and other commodities starting January 1, 2019. Australian producers recorded a 20-fold increase in exports to China this year, according to the Australian Board of Almonds.

Nothing to celebrate

Retaliatory tariffs imposed by India will shortchange the gains hoped for by California almond growers who are expecting a bumper harvest this year, but who also face tariffs in another top export market: China.

Indian importers might look for other sources but no other global exporter can match the volume of production by California’s almond growers. As long as India’s appetite for sweet almonds continues to grow, Indian consumers will pay a higher price for U.S. almonds at their upcoming celebrations.

PBhatnagar

Pragya Bhatnagar is a Research Associate with the Hinrich Foundation where he focuses on International Trade Research. He is a Hinrich Foundation Global Trade Leader Scholar alumnus, earning his Master’s degree in International Journalism, specializing in Business and Financial Journalism, from Hong Kong Baptist University. He received his bachelor’s degree in Economics from Lucknow University, India.

This article originally appeared on TradeVistas.org. Republished with permission.

imports

U.S. Imports of Fats And Oils Refining and Blending Doubled over the Last Five Years

IndexBox has just published a new report: ‘U.S. Fats And Oils Market. Analysis And Forecast to 2025.’ Here is a summary of the report’s key findings.

In 2018, the revenue of the fat and oil market in the U.S. amounted to $10.6B. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). Over the period under review, fat and oil consumption continues to indicate a decrease. The pace of growth was the most pronounced in 2016 when the market value decreased by -4% year-to-year. Fat and oil consumption peaked at $18.6B in 2013; however, from 2014 to 2018, consumption stood at a somewhat lower figure.

U.S. Fat And Oil Production

In value terms, fat and oil production totaled $10.5B in 2018. In general, fat and oil production continues to indicate a decline. The most prominent rate of growth was recorded in 2016 with a decrease of -4% year-to-year. Over the period under review, fat and oil production reached its peak figure level at $18.6B in 2013; however, from 2014 to 2018, production stood at a somewhat lower figure.

In value terms, shortening and cooking oils ($9.1B) constituted the leading product category. The second position in the ranking was occupied by margarine, butter blends, and butter substitutes ($1.3B).

From 2013 to 2018, the average annual rate of growth in terms of the production volume of shortening and cooking oils stood at -11.4%. With regard to the other produced products, the following average annual rates of growth were recorded: margarine, butter blends, and butter substitutes (-6.6% per year) and other fats and oils refining and blending (+20.4% per year).

Exports from the U.S.

In 2018, the amount of fats and oils exported from the U.S. stood at 22K tonnes, surging by 47% against the previous year. Over the period under review, the total exports indicated a strong expansion from 2013 to 2018: its volume increased at an average annual rate of +6.8% over the last five-year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, fat and oil exports increased by +126.1% against 2015 indices. The pace of growth was the most pronounced in 2018 when exports increased by 47% year-to-year. In that year, fat and oil exports attained their peak and are likely to continue its growth in the immediate term.

In value terms, fat and oil exports stood at $26M (IndexBox estimates) in 2018. Over the period under review, the total exports indicated strong growth from 2013 to 2018: its value increased at an average annual rate of +6.8% over the last five years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, fat and oil exports increased by +115.0% against 2015 indices. The most prominent rate of growth was recorded in 2018 when exports increased by 39% against the previous year. In that year, fat and oil exports reached their peak and are likely to continue its growth in the immediate term.

Exports by Country

Libya (5.9K tonnes), Egypt (3.1K tonnes) and India (3K tonnes) were the main destinations of fat and oil exports from the U.S., with a combined 55% share of total exports.

From 2013 to 2018, the most notable rate of growth in terms of exports, amongst the main countries of destination, was attained by India (+270.1% per year), while the other leaders experienced more modest paces of growth.

In value terms, Libya ($5.1M) emerged as the key foreign market for fat and oil exports from the U.S., comprising 19% of total fat and oil exports. The second position in the ranking was occupied by India ($2.3M), with a 8.6% share of total exports. It was followed by Egypt, with a 8.2% share.

From 2013 to 2018, the average annual growth rate of value to Libya was relatively modest. Exports to the other major destinations recorded the following average annual rates of exports growth: India (+201.4% per year) and Egypt (0.0% per year).

Export Prices by Country

The average fat and oil export price stood at $1,210 per tonne in 2018, going down by -5.7% against the previous year. Over the last five-year period, it increased at an average annual rate of +3.1%. The growth pace was the most rapid in 2015 an increase of 23% year-to-year. The export price peaked at $1,283 per tonne in 2017, and then declined slightly in the following year.

Prices varied noticeably by the country of destination; the country with the highest price was South Korea ($4,008 per tonne), while the average price for exports to Egypt ($690 per tonne) was amongst the lowest.

From 2013 to 2018, the most notable rate of growth in terms of prices was recorded for supplies to South Korea, while the prices for the other major destinations experienced more modest paces of growth.

Imports into the U.S.

In 2018, the fat and oil imports into the U.S. stood at 55K tonnes, increasing by 18% against the previous year. In general, fat and oil imports continue to indicate a skyrocketing expansion. The pace of growth was the most pronounced in 2014 with an increase of 42% y-o-y. Imports peaked in 2018 and are likely to continue its growth in the immediate term.

In value terms, fat and oil imports totaled $154M (IndexBox estimates) in 2018. Over the period under review, the total imports indicated remarkable growth from 2013 to 2018: its value increased at an average annual rate of +20.1% over the last five-year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, fat and oil imports increased by +80.1% against 2013 indices. The pace of growth was the most pronounced in 2018 when imports increased by 18% y-o-y. In that year, fat and oil imports reached their peak and are likely to continue its growth in the immediate term.

Imports by Country

In 2018, Indonesia (16K tonnes) constituted the largest supplier of fat and oil to the U.S., with a 29% share of total imports. Moreover, fat and oil imports from Indonesia exceeded the figures recorded by the second-largest supplier, Spain (6.1K tonnes), threefold. India (5.9K tonnes) ranked third in terms of total imports with a 11% share.

From 2013 to 2018, the average annual rate of growth in terms of volume from Indonesia stood at +105.7%. The remaining supplying countries recorded the following average annual rates of imports growth: Spain (+81.4% per year) and India (+8.4% per year).

In value terms, Indonesia ($49M) constituted the largest supplier of fat and oil to the U.S., comprising 32% of total fat and oil imports. The second position in the ranking was occupied by Malaysia ($15M), with a 10% share of total imports. It was followed by India, with a 7.6% share.

From 2013 to 2018, the average annual rate of growth in terms of value from Indonesia stood at +113.3%. The remaining supplying countries recorded the following average annual rates of imports growth: Malaysia (+52.6% per year) and India (+9.8% per year).

Import Prices by Country

In 2018, the average fat and oil import price amounted to $2,774 per tonne, flattening at the previous year. Over the period under review, the fat and oil import price continues to indicate an abrupt decline. The most prominent rate of growth was recorded in 2016 an increase of 26% year-to-year. The import price peaked at $3,840 per tonne in 2013; however, from 2014 to 2018, import prices stood at a somewhat lower figure.

Prices varied noticeably by the country of origin; the country with the highest price was Germany ($7,513 per tonne), while the price for Ecuador ($1,043 per tonne) was amongst the lowest.

From 2013 to 2018, the most notable rate of growth in terms of prices was attained by Malaysia, while the prices for the other major suppliers experienced more modest paces of growth.

Source: IndexBox AI Platform

almond

Global Almond Market 2019 – After Five Years of Robust Growth of In-Shell Nut Imports, India Emerges as the Most Promising Market

IndexBox has just published a new report: ‘World – Almonds – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The global almond market revenue amounted to $10.5B in 2018, going up by 6.5% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). In general, the total market indicated remarkable growth from 2007 to 2018: its value increased at an average annual rate of +2.4% over the last eleven years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, the almond consumption increased by +62.4% against 2008 indices. The pace of growth was the most pronounced in 2011, when the market value increased by 18% against the previous year. Global almond consumption peaked in 2018, and is likely to continue its growth in the immediate term.

Production 2007-2018

Global almond production stood at 2.4M tonnes in 2018, rising by 3.8% against the previous year. The total output volume increased at an average annual rate of +2.8% from 2007 to 2018; the trend pattern remained relatively stable, with only minor fluctuations being recorded over the period under review. The growth pace was the most rapid in 2011, when the output figure increased by 13% year-to-year. Global almond production peaked in 2018, and is expected to retain its growth in the near future. The general positive trend in terms of almond output was largely conditioned by a measured increase of the harvested area and a slight growth in yield figures.

Exports 2007-2018

Global exports totaled 306K tonnes in 2018, coming down by -6.2% against the previous year. Overall, the total exports indicated strong growth from 2007 to 2018: its volume increased at an average annual rate of +7.0% over the last eleven year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. In value terms, almond exports amounted to $1.3B (IndexBox estimates) in 2018.

Exports by Country

In 2018, the U.S. (204K tonnes) represented the major exporter for almonds, generating 67% of total exports. China, Hong Kong SAR (36K tonnes) ranks second in terms of the total exports with a 12% share, followed by Australia (7%) and Benin (6.8%). The United Arab Emirates (7K tonnes) followed a long way behind the leaders.

Exports from the U.S. increased at an average annual rate of +11.5% from 2007 to 2018. At the same time, Australia (+12.1%) and the United Arab Emirates (+7.6%) displayed positive paces of growth. Moreover, Australia emerged as the fastest growing exporter in the world, with a CAGR of +12.1% from 2007-2018. Benin and China, Hong Kong SAR experienced a relatively flat trend pattern. From 2007 to 2018, the share of the U.S. and Australia increased by +47% and +5% percentage points, while the shares of the other countries remained relatively stable throughout the analyzed period.

In value terms, the U.S. ($993M) remains the largest almond supplier worldwide, comprising 76% of global exports. The second position in the ranking was occupied by China, Hong Kong SAR ($117M), with a 9% share of global exports. It was followed by Australia, with a 8.1% share.

Export Prices by Country

The average almond export price stood at $4,284 per tonne in 2018, therefore, remained relatively stable against the previous year. In general, the export price indicated remarkable growth from 2007 to 2018: its price increased at an average annual rate of +4.4% over the last eleven year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, the almond export price decreased by -1.4% against 2015 indices. There were significant differences in the average export prices amongst the major exporting countries. In 2018, the country with the highest export price was Australia ($4,963 per tonne), while Benin ($448 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of export prices was attained by China, Hong Kong SAR, while the other global leaders experienced more modest paces of growth.

Imports 2007-2018

In 2018, approx. 299K tonnes of almonds were imported worldwide; going down by -2% against the previous year. The total import volume increased at an average annual rate of +2.8% from 2007 to 2018; however, the trend pattern indicated some noticeable fluctuations being recorded over the period under review. The growth pace was the most rapid in 2016, with an increase of 20% against the previous year. Global imports peaked at 325K tonnes in 2012; however, from 2013 to 2018, imports stood at a somewhat lower figure. In value terms, almond imports totaled $1.4B (IndexBox estimates) in 2018. Overall, almond imports, however, continue to indicate remarkable expansion. The pace of growth was the most pronounced in 2011, with an increase of 19% y-o-y. Over the period under review, global almond imports attained their maximum at $1.4B in 2017, and then declined slightly in the following year.

Imports by Country

In 2018, India (131K tonnes) represented the key importer for almonds, making up 44% of total imports. It was distantly followed by Viet Nam (61K tonnes), China, Hong Kong SAR (46K tonnes) and China (15K tonnes), together committing 41% share of total imports. The following importers – the United Arab Emirates (6.2K tonnes), Japan (5.8K tonnes) and Spain (5.8K tonnes) – each amounted to a 5.9% share of total imports.

Imports into India increased at an average annual rate of +9.8% from 2007 to 2018. At the same time, China (+21.6%), China, Hong Kong SAR (+16.8%), Spain (+7.4%) and the United Arab Emirates (+7.0%) displayed positive paces of growth. Moreover, China emerged as the fastest growing importer in the world, with a CAGR of +21.6% from 2007-2018. Japan experienced a relatively flat trend pattern. By contrast, Viet Nam (-6.0%) illustrated a downward trend over the same period. While the share of India (+28 p.p.), China, Hong Kong SAR (+13 p.p.) and China (+4.3 p.p.) increased significantly in terms of the global imports from 2007-2018, the share of Viet Nam (-19.8 p.p.) displayed negative dynamics. The shares of the other countries remained relatively stable throughout the analyzed period.

In value terms, India ($666M) constitutes the largest market for imported almonds worldwide, comprising 48% of global imports. The second position in the ranking was occupied by Viet Nam ($243M), with a 17% share of global imports. It was followed by China, Hong Kong SAR, with a 15% share.

Import Prices by Country

The average almond import price stood at $4,675 per tonne in 2018, approximately reflecting the previous year. Over the period under review, the almond import price continues to indicate strong growth. There were significant differences in the average import prices amongst the major importing countries. In 2018, the country with the highest import price was Japan ($6,976 per tonne), while Spain ($3,921 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of import prices was attained by Viet Nam, while the other global leaders experienced more modest paces of growth.

Source: IndexBox AI Platform

Global Vegetable Market 2019 – Resilient Growth of Potato Consumption in China and India Shapes Overall Market Trend

IndexBox has just published a new report: ‘World – Vegetable – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The global vegetable market revenue amounted to $1,249.8B in 2018, picking up by 2.4% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). The market value increased at an average annual rate of +4.1% over the period from 2007 to 2018; the trend pattern indicated some noticeable fluctuations being recorded in certain years. The pace of growth appeared the most rapid in 2010, with an increase of 8.1% against the previous year. Global vegetable consumption peaked in 2018, and is likely to continue its growth in the immediate term.

Production 2007-2018

Global vegetable production stood at 1,555M tonnes in 2018, jumping by 3.2% against the previous year. The total output volume increased at an average annual rate of +2.8% over the period from 2007 to 2018; the trend pattern remained consistent, with somewhat noticeable fluctuations throughout the analyzed period.

Exports 2007-2018

In 2018, approx. 47M tonnes of vegetables were exported worldwide; standing approx. at the previous year. The total export volume increased at an average annual rate of +1.7% from 2007 to 2018; the trend pattern remained consistent, with only minor fluctuations being recorded over the period under review. In value terms, vegetable exports amounted to $42.3B (IndexBox estimates) in 2018.

Exports by Country

The Netherlands (6.1M tonnes), Mexico (5.8M tonnes), Spain (5.1M tonnes), China (4.3M tonnes), France (3.5M tonnes), Germany (2.7M tonnes) and the U.S. (2.4M tonnes) represented roughly 64% of total exports of vegetables in 2018. The following exporters – Canada (1.4M tonnes), Belgium (1.3M tonnes), India (1.2M tonnes), Egypt (1.1M tonnes) and Italy (864K tonnes) – together made up 13% of total exports.

From 2007 to 2018, the most notable rate of growth in terms of exports, amongst the main exporting countries, was attained by Mexico, while the other global leaders experienced more modest paces of growth.

In value terms, Spain ($6.7B), the Netherlands ($6.5B) and Mexico ($6.2B) constituted the countries with the highest levels of exports in 2018, together comprising 46% of global exports.

Export Prices by Country

The average vegetable export price stood at $899 per tonne in 2018, leveling off at the previous year. Over the period from 2007 to 2018, it increased at an average annual rate of +1.1%. The growth pace was the most rapid in 2017, when the average export price increased by 6.6% against the previous year. In that year, the average export prices for vegetables reached their peak level of $910 per tonne, and then declined slightly in the following year.

Export prices varied noticeably by the country of origin; the country with the highest export price was Italy ($1,679 per tonne), while Germany ($342 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of export prices was attained by Canada, while the other global leaders experienced more modest paces of growth.

Imports 2007-2018

In 2018, approx. 47M tonnes of vegetables were imported worldwide; approximately mirroring the previous year. The total import volume increased at an average annual rate of +1.8% over the period from 2007 to 2018; the trend pattern remained consistent, with somewhat noticeable fluctuations being recorded in certain years. The growth pace was the most rapid in 2010, when imports increased by 7.2% year-to-year. Over the period under review, global vegetable imports attained their peak figure at 49M tonnes in 2016; however, from 2017 to 2018, imports stood at a somewhat lower figure. In value terms, vegetable imports totaled $41.9B (IndexBox estimates) in 2018. The total import value increased at an average annual rate of +2.7% from 2007 to 2018; the trend pattern indicated some noticeable fluctuations being recorded throughout the analyzed period. The pace of growth appeared the most rapid in 2010, when imports increased by 17% year-to-year. Global imports peaked at $42.5B in 2017, and then declined slightly in the following year.

Imports by Country

In 2018, the U.S. (7.4M tonnes), distantly followed by Germany (3.8M tonnes), the Netherlands (3.1M tonnes), Russia (2.2M tonnes) and the UK (2.2M tonnes) were the key importers of vegetables, together achieving 39% of total imports. The following importers – Belgium (1.9M tonnes), Canada (1.9M tonnes), France (1.9M tonnes), Malaysia (1.4M tonnes), Italy (1.2M tonnes), Spain (1.2M tonnes) and Indonesia (819K tonnes) – together made up 22% of total imports.

From 2007 to 2018, the most notable rate of growth in terms of imports, amongst the main importing countries, was attained by the U.S., while the other global leaders experienced more modest paces of growth.

In value terms, the largest vegetable importing markets worldwide were the U.S. ($8.5B), Germany ($5.1B) and the UK ($3B), with a combined 40% share of global imports. These countries were followed by Canada, France, the Netherlands, Russia, Belgium, Italy, Spain, Malaysia and Indonesia, which together accounted for a further 30%.

Import Prices by Country

The average vegetable import price stood at $884 per tonne in 2018, approximately mirroring the previous year. Overall, the vegetable import price, however, continues to indicate a relatively flat trend pattern. There were significant differences in the average import prices amongst the major importing countries. In 2018, the country with the highest import price was the UK ($1,367 per tonne), while Malaysia ($472 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of import prices was attained by Spain, while the other global leaders experienced more modest paces of growth.

Source: IndexBox AI Platform