The ongoing tariff battle between the United States and China is already having a ripple effect on farmers and business owners right here in the Pacific Northwest.
More than 450 Northwest dairy farms in Washington, Oregon, Idaho and Montana rely on Darigold to process their milk into products that ship all over the United States and the globe.
“Large amounts of the ingredient gets marketed and sold and distributed around the world – 20 countries, of which, China is one of them,” said Stan Ryan, the president and CEO of Darigold.
But the trade war and increasing tariffs have shot Darigold’s duty to 25 percent, and even higher on some products for the $50 million of business they were doing in China.
“Our competing origins, the countries we compete against to earn customers in China don’t have those same duties so the market dried up for us overnight,” said Ryan.
Other Northwest crops are impacted too – apples, cherries, potatoes and much more.
“If they can’t sell their products overseas, it means less money, which means fewer jobs, and that really impacts our livelihood and the livability of our families in the state of Washington,” said former Washington Governor Gary Locke, who is also a former U.S. Ambassador to China and former U.S. Secretary of Commerce.
Ryan says the tariffs are preventing the already troubled dairy industry from seeing improvement.
“The environmental contributes to already depressed farm prices – so it hurt our local farmers,” said Ryan.
The depressed farm prices are due to chronic oversupply.
Just last year Darigold opened an office in Shanghai because of what Ryan calls an unbelievable long-term growth opportunity.
So for now, since business has all but stopped, the office remains busy with potential future customers so they are ready when the tide turns.
“We are investing in it and we have the faith that our U.S. trade representative in the administration will see this through and will come out with a good logical outcome,” said Ryan.