- Title: U.S. importers stockpile Parmigiano, Provolone as tariffs on EU cheeses loom
- Date: 5th October 2019
- Summary: WEST CALDWELL, NEW JERSEY, UNITED STATES (OCTOBER 4, 2019) (REUTERS) VARIOUS OF THE AMBRIOLA COMPANY, A SUBSIDIARY OF AURICCHIO, PRESIDENT & CEO PHILIP MARFUGGI, AT HIS COMPANY'S CHEESE STORAGE AND PROCESSING FACILITY (SOUNDBITE) (English) PHILIP MARFUGGI, THE AMBRIOLA COMPANY, A SUBSIDIARY OF AURICCHIO, PRESIDENT & CEO, AND CHEESE IMPORTERS ASSOCIATION OF AMERICA PRESIDENT, SAYING: "So, we were lucky enough to start building up some inventory in August, in September, but, you know, that's a fear that there's a product that's coming in here, that's going to cost me another $70,000 to $80,000 per truckload or container. And am I going to be able to sell it? So, that's another economic hardship that you come in. So, we've been stockpiling cheese. You know, my current inventory, in my warehouse, normally, my normal inventory would be $9 to $10 million of product. I probably have now $15 or $16 million worth of goods. And, when these other containers do come in, I'll have to use some outside storage, which also costs more money." MARFUGGI WALKING IN CHEESE STORAGE AREA VARIOUS OF WORKERS PROCESSING CHEESE (SOUNDBITE) (English) PHILIP MARFUGGI, THE AMBRIOLA COMPANY, A SUBSIDIARY OF AURICCHIO, PRESIDENT & CEO, AND CHEESE IMPORTERS ASSOCIATION OF AMERICA PRESIDENT, SAYING: "So it's very difficult for the importers and my company to invest in the future. I mean, how am I going to invest or promote something, where I may not be able to sell in the future? We have a conversion, and cutting, and grading, and shredding operation, packaging operation here in New Jersey. Back in March, we were looking to expand and possibly build another cutting and grading operation, and that's been put on the table. I mean, I'm not going to build something if I don't have any cheese to cut, or wrap, or sell. So, it's just very difficult for everybody in the imported cheese sector, and I'm sure in other sectors that are hit with the tariffs, too." VARIOUS OF CHEESE PROCESSING FACILITY (SOUNDBITE) (English) PHILIP MARFUGGI, THE AMBRIOLA COMPANY, A SUBSIDIARY OF AURICCHIO, PRESIDENT & CEO, AND CHEESE IMPORTERS ASSOCIATION OF AMERICA PRESIDENT, SAYING: "So, you're going to see a considerable increase in imported cheese prices. Maybe not in the first month or two, because I'm sure some importers have brought product in, at least the cheeses that can last long, that have a longer shelf life. So, maybe they won't pass on immediately the increase. But, you know, another two months down the road, you're going to see an increase of, you know, you don't know how long this is going to last either." VARIOUS OF CHEESE PROCESSING FACILITY (SOUNDBITE) (English) PHILIP MARFUGGI, THE AMBRIOLA COMPANY, A SUBSIDIARY OF AURICCHIO, PRESIDENT & CEO, AND CHEESE IMPORTERS ASSOCIATION OF AMERICA PRESIDENT, SAYING: "And, if you want to penalize Europe, fine, but you're looking at $3.5 billion of revenue that's generated by U.S. companies, most of the importers are U.S. companies, so you're looking at truckers, dock workers, factory workers, and everybody else that will be affected by this. So, we're generating $3.5 billion in the economy. So, that's something, where, you know, you talk about American jobs, American workers. Well, just because we import and sell cheese from Europe, we're American companies that employ American people, and pay American taxes, and that's something that I think is lost in the current administration, that, you know, you're not just penalizing Europe, you're penalizing the U.S. worker, and companies here in the U.S." VARIOUS OF CHEESE PROCESSING FACILITY VARIOUS OF CHEESE STORAGE AREA WASHINGTON, D.C., UNITED STATES (OCTOBER 4, 2019) (REUTERS) EASTERN MARKET ON CAPITOL HILL VARIOUS OF MIKE BOWERS, A THIRD-GENERATION OWNER OF A SPECIALTY CHEESE SHOP (SOUNDBITE) (English) MIKE BOWERS, A THIRD-GENERATION OWNER OF A SPECIALTY CHEESE SHOP, SAYING: "But you know, right now, the initial thing is to make sure that my customers are... are... stockpiled. I have a stockpile of cheese to make sure that I'm able to maintain inventory, and maintain sales at my counter. And then, as time goes on, that's the other thing is I'm just... I'm the one stop shop, right? I own the business. I buy the cheese. I sell the cheese, so I have first hand here on the customer." BOWERS' SHOP VARIOUS OF BOWERS' CHEESE STOCKPILE BOWERS CUTTING CHEESE (SOUNDBITE) (English) MIKE BOWERS, THIRD-GENERATION OWNER OF A SPECIALTY CHEESE SHOP, SAYING: "Well, the cases are filled at the top. You can see I'm kind of brimming, and I got cases underneath, and I got the walk in there, and New York cheddar and things, I store up in New York. New York cheddars, but those are those are offsite." BOWERS' CHEESE STOCKPILE BOWERS WEIGHING BOWERS CUTTING CHEESE WIDE OF BOWERS' SHOP AT EASTERN MARKET
- Embargoed: 19th October 2019 16:29
- Keywords: Trump administration USTR trade retaliation for EUsubsidies on large aircraft 25% tariffs consumers stockpile European cheeses Phil Marfuggi Italian cheese European Union cheeses Auricchio
- Location: WEST CALDWELL, NEW JERSEY, AND WASHINGTON, D.C., UNITED STATES
- City: WEST CALDWELL, NEW JERSEY, AND WASHINGTON, D.C., UNITED STATES
- Country: USA
- Topics: Government/Politics,International Trade
- Reuters ID: LVA001AZTL3YF
- Aspect Ratio: 16:9
- Story Text: Ambriola Co. Inc.'s mammoth warehouse in West Caldwell, New Jersey, is crammed full of boxes and wheels of harder cheeses such as Parmigiano Reggiano, Pecorino Romano and Grana Padano - and more is coming, lots more.
Phil Marfuggi, president and chief executive officer of Ambriola, a unit of Auricchio SpA, one of Italy's largest cheese producers, is among the many importers and shop owners across the country who are scrambling to stockpile European cheeses before new U.S. tariffs kick in on Oct. 18 in efforts to shield consumers from price hikes.
The Trump administration on Wednesday slapped 25% tariffs on cheese and other European Union products ranging from whisky to woolens, in retaliation for EU subsidies on large aircraft. Both sides say they are open to negotiations, but trade experts see little chance of averting the duties - at least in the short run.
Importers began ordering millions of dollars of extra wheels of Parmigiano Reggiano and other harder cheeses after the U.S. Trade Representative's office in July added cheese to its list of EU products potentially facing tariffs due to the dispute over aircraft subsidies.
"We've been stockpiling cheese," said Marfuggi, who has another 21 shipping containers full of cheese en route to be added to the stockpile in the company's warehouse in Caldwell, which sits about 15 miles west of Manhattan.
Marfuggi said he ordered an extra $15 million of cheeses that could be stored for over a year to ensure adequate supplies for existing customers and protect pricing through the end of the year.
The new duties could slash U.S. imports of EU cheeses valued at $1.5 billion a year by 30% and jack up prices across the country, said Marfuggi, who also serves as president of the Cheese Importers Association of America.
Some higher-priced items will simply disappear from stores, he predicted, like Moliterno al Tartufo, an aged Italian cheese with an intense truffle flavor. Even Parmigiano Reggiano could be at risk if prices rose to $30 a pound, he said.
Over 20,000 U.S. retail stores ranging from Costco Wholesale Corp. to Wegmans Food Markets sell EU cheeses. These cheeses generate some $3.5 billion of revenue for U.S. companies, supporting some 20,000 jobs, including buyers, deli clerks, truck drivers and warehouse workers, Hoffman said. He noted that the new tariffs come on top of existing duties of around 15%.
Mike Bowers, the third-generation owner of a specialty cheese shop at Washington's storied Eastern Market, said he began hoarding extra wheels of hard cheeses - some weighing as much as 80 pounds - in July when USTR first announced it could impose tariffs on cheese and other agricultural goods.
"The initial thing is to make sure that my customers are... are... stockpiled. I have a stockpile of cheese to make sure that I'm able to maintain inventory, and maintain sales at my counter," he said.
His glass cheese counters, coolers and large walk-in refrigerator are filled to overflowing, but Bowers said his supplies will not last through the holiday season. He said he will have to pass on the cost of the tariffs.
(Production: Nelson Villarreal, Aleksandra Michalska, Kevin Fogharty, Andrea Shalal) - Copyright Holder: REUTERS
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