Overview
by Henrich Brunke, Post Graduate Researcher, Agricultural Issues Center, University of California, brunke@ucdavis.edu
Revised by Malinda Miller, specialist, Ag Marketing Resource Center, Iowa State University, malindag@iastate.edu
Profile created August 2002; revised July 2005.
California is the main producer of English walnuts in the United States and produces 99 percent of the nation’s walnuts. The term “English” applied to walnuts is a misnomer. It apparently refers to the English merchant marines whose ships transported the nuts for trade around the world. There are two species of walnuts, the English (Juglans regia), which originated in Persia, and the black walnut, which is native to the United States.
In California, there are over 30 varieties of commercially produced walnuts, all of which are hybrids of the English walnut. The Northern California black walnut is primarily used as the rootstock for English walnut cultivars. The black walnut is of high flavor, but due to its hard shell and poor hulling characteristics it is not grown commercially for nut production. The Eastern American Black walnut is grown east of the Rocky Mountains primarily for wood and veneer.
The California walnut industry is made up of more than 5,000 walnut growers and about 55 walnut processors. A federal marketing order is in place for walnuts, which established the Walnut Marketing Board and regulates that all walnuts be inspected and certified as meeting strict USDA specifications.
Production
California production of walnuts amounted to 325,000 tons in 2004. However, production has fluctuated over the years due to the alternate bearing cycles of walnut trees. Harvests were particularly low at 208,000 tons in 1996 and 227,000 tons 1998.
Total walnut acreage in California has been increasing. In 1993, walnut trees were grown on 175,000 acres. By 2004, acreage had risen to 217,000 acres. Walnuts had a value of $1,350 per ton in 2004.
Consumption
Per capita consumption of walnuts was .5 pound in 2003.
Exports
The United States is a net exporter of walnuts with California being the only walnut exporting U.S. state. In 2004, walnut exports were $240.7 million. Shelled walnuts made up the majority of the export value at $148.9 million. In-shell walnut exports accounted for $91.8 million.
According to the California Walnut Marketing Board, the industry ships approximately 40 percent of the harvested crop overseas. The top export destinations for in-shell walnuts were Spain, Italy and Germany. Japan is the top buyer of U.S. shelled walnuts.
Throughout the 1990s, in-shell walnuts were the most important walnut export product of the United States. In 1989, two-thirds of the exports were in-shell walnuts. However, by 2001, shelled walnuts had a higher export value than in-shell walnuts. Shelled walnut exports have consistently increased in value since 1989.
Walnut exports to Canada in 2004 were valued at $20.5 million with shelled walnuts accounting for more than 83 percent. In 1989, the value of exports was almost equally made up of shelled and in-shell walnut shipments.
Trade with Mexico has fluctuated during the post-NAFTA era. U.S. walnut exports to Mexico were relatively low until 1993, the year before NAFTA, when they surged to $1.8 million. Exports were $5.7 million in 1998 and peaked a year later at almost $15 million. In 2004, walnut exports to Mexico were $3.5 million, with the majority of exports consisting of shelled walnuts.
Imports
In 2004, the total shelled walnut imports into the United States were valued at $471,000. Turkey was the number one importer with $197,000. Imports of in-shell walnuts totaled $27,000 in 2004. China and Turkey were the primary suppliers of U.S. imported in-shell walnuts.
Tariff rates and policy changes resulting from NAFTA
The United States charges seven cents per kilogram on in-shell walnut imports and 26.5 cents per kilogram on shelled walnut imports from countries with which the United States maintain normal trade relations. Trade partners without normal trade status with the United States face tariffs of 11 cents per kilogram and 33.1 cents per kilogram for shipments of in-shell and shelled walnuts into the United States.
Canada did not impose a tariff before signing the Canadian-U.S. Free Trade Agreement (CUSTA) in 1988. Before NAFTA became effective in 1994, Mexico imposed a tariff of 20 percent on walnut imports from the United States. The Mexican tariff was eliminated immediately upon NAFTA’s implementation.
The U.S. tariffs for imports from Canada were eliminated over 5 years in the case of in-shell walnuts and over 10 years in the case of shelled walnuts. The tariffs for imports from Mexico were eliminated upon NAFTA’s implementation in 1994.
Sources
California Walnut Marketing Board.
Food Consumption (per capita) Data System, Economic Research Service, USDA
Foreign Agricultural Service, Attaché Reports, USDA
Fruit and Tree Nuts Outlook and Yearbook, Economic Research Service, USDA
The Harmonized Tariff Schedule of the United States United States International Trade Commission
Interactive Tariff and Trade Dataweb, United States International Trade Commission
Walnuts, Commodity Reports, National Agricultural Statistical Service, USDA