Wisconsin ginseng growers are “very concerned” with the 15 percent tariff on their crop imposed by China in response to U.S. tariffs on steel and aluminum.
The Ginseng Board of Wisconsin says this recently enacted tax threatens the strength of the Wisconsin ginseng industry, which accounts for up to 95 percent of U.S. ginseng production.
President Trump announced in early March a 25 percent tariff on steel and a 10 percent tariff on aluminum. Some of the country’s biggest trade partners, including China and the European Union, responded with threats of imposing tariffs of their own on American-made products like blue jeans and motorcycles.
According to the state Ginseng Board, many Chinese distributors are saying they could take their business to Canada — the largest producer of North American ginseng, according to the Ontario Ginseng Growers Association.
China is the most important market for state ginseng growers, with over 85 percent of the state’s ginseng exported to China or brought there as a gift in 2017. That equals $30 million in sales to Wisconsin’s 180 ginseng producers.
The next biggest recipients for ginseng are other, smaller Asian markets like Taiwan and the domestic market.
Jackie Fett, executive director and head of marketing for the Ginseng Board, says “it’s a bit too early to tell” what the impact of the tariff will be, but the board is examining a number of possible scenarios.
She says the tariff could hit Wisconsin producers directly, causing their profit margins to drop. In a more optimistic future, she says growers could find buyers for their product at a higher price.
“That would be great,” Fett said. “But if prices are too high, then [buyers] can shift over to alternatives… so we’re on a bit of a teeter-totter.”
Ginseng is just one of the products for which China is imposing tariffs. Others include pork, wine, nuts and cranberries — another top crop for Wisconsin agriculture.
–By Alex Moe