Keith Hu: Trade War Pushes Northwest Cherry Growers to Switch from China to India

The potential of Chinese consumers to provide the stable export market for cherry producers in America’s Northwest feels largely out of reach, at least for now. That has forced producers to explore alternatives like India and Vietnam to make up for the exports that they have lost due to President Donald Trump’s two trade wars (the first during his first term in office from 2017-2021 and the second one that began when he returned to office in January).

“Yes, the trade war dramatically increased the cost of cherries,” Northwest Cherry Growers Association Director of International Operations Keith Hu told American Farmland Owner as he prepared for another overseas exploration trip.

Hu has spent the past two decades with Northwest Cherry Growers Association and has seen the collapse of cherry exports to China. “This year, the total tariff or tax on cherries is… 54%,” Hu said.

That resulted in another 35% decline in cherry exports to China, Hu explained.

Keith Hu bio:

• Northwest Cherry Growers – Director of International Operations (current)

• Mango Marketing – Managing Partner

• Wizards of the Coast – Country Manager

• FVA Airways Corp – International Cargo Sales

The ongoing U.S.-China trade war has significantly dented profitability. Hu said that although Chinese consumers appreciate the high-quality product that U.S. cherry growers offer, they can’t afford the higher prices that current trade policies caused. That led to the significant export decline, even though U.S. cherry production was up.

“My job is to continue to diversify ourselves away from China,” Hu said. “And I think my team is doing a pretty good job.”

Vietnam, Thailand, and Southeast Asia Offer Export Possibilities for U.S. Cherries

One of the regions benefitting most from this pivot is Southeast Asia, particularly Vietnam and Thailand. “Southeast Asia has become very strong for us,” Hu noted.

“Vietnam benefited the most from the trade war between the U.S. and China. When I first went to Vietnam ten years ago, I saw the development of the middle-income class… cranes everywhere, high-rises popping out left and right,” Hu recalled.

The similarity between Vietnam’s current economic growth and China's trajectory in the late 1990s gives Hu confidence in its potential. The growing middle class is eager to spend on premium imported goods, including cherries. And unlike the Chinese market, these countries are not burdened by the same level of import restrictions or geopolitical friction.

RELATED: The potential of cherries was part of this land values report in 2023.

India Could Provide Biggest Source of New Exports for U.S. Cherries

Still, the most intriguing development may be the U.S. cherry industry's increasing focus on India, a market with over 1.4 billion people, a growing middle class, and a hunger for premium products, despite notable hurdles.

“Yes, there’s definitely money there,” Hu confirmed. “The ‘haves’ are willing to spend. The downside is our price is five times more expensive than local produce or imports from the Middle East or Turkey.”

India presents a logistical challenge due to its geographic distance from the Pacific Northwest. “It’s literally on the other side of Washington State,” Hu joked. “Getting products over there is a lot more difficult than getting products to Asia-Pacific.”

India also faces infrastructure limitations that make it difficult to handle delicate, perishable goods like cherries. “Cherry’s still a very delicate product to form,” Hu explained.

“They [India] still don’t have the technique or the weather to back them up yet,” Hu said, “and the infrastructure is not as well established for highly perishable goods.”

Hu emphasized the importance of improving that. “The biggest thing is the infrastructure. They need to continue to develop it. And hopefully, we’ll have more direct flights or shorter transit times from Seattle to any major cities in India,” he said.

U.S. Cherry Growers Face International Competition

Despite the high cost of U.S. cherries in India, Hu believes that Northwest cherries still have an edge in quality. “Turkey will be my biggest competitor,” he said. “They are the biggest cherry-producing country in the world. But even when it compares to quality, they don’t have the quality like we have.”

Hu acknowledges the improvements made by Chinese cherry producers over the past two decades. “Those cherries look beautiful, almost as good as Northwest cherries. But they don't have the flavors yet,” he said.

Meanwhile, U.S. cherry growers will focus on other emerging markets. “Diversification is no longer a buzzword,” Hu stressed. “It’s a necessity.”

South Korea, Taiwan, and Southeast Asia will remain critical, but India is now on the radar as a potentially transformative market.

“We believe the potential for India is big,” he concluded. “However, there are obstacles that need to be ironed out.”