Washington state’s apple growers have been looking forward to a great upcoming season, fueled by a bountiful crop and by China’s opening its market to all varieties of U.S. apples. But this week came some sobering news about that market: China, in a surprise move, devalued its yuan in the hopes of bolstering its slowing economy.
That, overnight, makes Washington state apples more expensive for the Chinese. But by itself, the currency shift — 4.4 percent this week through Thursday — isn’t enough to cause worry among Washington’s apple growers.
Rather, the big concern is if the move “is signaling weakness of the economy in China and what it means in terms of the purchasing power of the middle class in China,” said Rebecca Lyons, international marketing director for the Washington Apple Commission.
California's growers are also casting a wary eye toward China, their third-biggest trading partner, because the devaluation of its currency is expected to make pistachios, almonds and other farm products more expensive.
Immediate effects are expected to be modest, given the small margin of adjustment in the yuan — more than 4% this week.
California sold $2.3 billion in agricultural products to China in 2012, with almonds, dairy products, wine, walnuts and pistachios making up the top five products, according to the California Department of Food and Agriculture. About $391 million came from almonds alone, according to the U.S. Department of California.
The crisis could be a wake-up call for California growers dependent on rising commodity prices because of demand from China, Paggi said. Although China represents about 10% of the state's foreign exports, it accounts for 35% of the state's export of pistachios, 19% of its beef, 17% of its oranges and 16% of its almond and walnut exports.
