Items of potential interest to beekeepers 11 October 2018
Rosanna Mattingly Editor, Western Apicultural Society Journal Editor, The Bee Line, Oregon State Beekeepers Association
IN THIS ISSUE… UC Webinar Oregon Varroa Alert UBC Bee Symposium Mexico’s Science Minister Tybee Island Bee Deaths Oshawa Pollinators Native Bees and Buzz Pollination Witte Museum Exhibit
FROM CATCH THE BUZZ 1. Enhanced Pollen Collection 2. Bayer Strategy 3. Warwick Kerr’s Work 4. Tariffs and Rerouting Goods
UC agriculture experts offer a webinar series
DAVIS, Calif. — Continuing education credits required by the California Department of Pesticide Regulation will now be available from UC Cooperative Extension by participating in live webinars.
“Everybody is busy,” said Beth Grafton-Cardwell, UCCE citrus entomology specialist. “It’s hard for people to get to meetings. Now, they can get some of the hours they need for updating their professional licenses from home or work, or even on their smartphones.”
Live webinars allow experts to talk about timely issues, such as new pest outbreaks, and give participants the option to ask questions via chat and get immediate answers from presenters.
The first webinar is from 3 to 4 p.m. Oct. 17 and will focus on citrus thrips, a perennial pest in citrus production that can vary greatly from year to year. Grafton-Cardwell will discuss biology, biological control, temperature effects, damage, monitoring, chemical control and resistance.
Participants must register in advance on the UC Ag Experts Talk website and connect to the webinar from beginning to end in order to receive continuing education credit. The course will be held on Zoom, communications software that enables video conferencing. Attendees will link into the meeting with audio and video online via computer or smartphone. Details for connecting will be emailed following online registration.
The continuing education sessions will be offered each month by various UC Cooperative Extension experts. On Nov. 14, Ben Faber, UCCE advisor in Ventura County, will discuss avocado diseases. Future class dates and topics will be posted on the UC Ag Experts Talk website.
Professional pest control advisers must complete 40 hours of continuing education every two years; qualified applicator certification and qualified applicators license renewal requires 20 hours every two year, according to the California Department of Pesticide Regulation.
All the webinars will be recorded and the sessions posted on the web, however, watching the recording will be for informational purposes only and not eligible for continuing education credit.
–UC Agriculture and Natural Resources
Source: https://www.morningagclips.com/uc-agriculture-experts-offer-a-webinar-series
—— Oregon Varroa Alert Ramesh Sagili, Oregon State University We would like to take this opportunity to alert / caution you regarding high mite populations in honey bee colonies this year due to another unusually long bee season similar to past years (2015 and 2016). We had another long bee season this year due to prevailing warm weather of about 7 months. Longer brood cycle (abundance of larvae) usually results in higher mite populations, as the mites get a greater opportunity to breed and increase their populations compared to bees. It has been reported that mite populations could increase exponentially (up to about 50 fold increase) in years when the brood is present in colonies almost round the year (Martin 1998). We are observing significantly higher mite intensities this year in both commercial and backyard beekeeping operations. Some beekeepers have treated their colonies several times this year and are still struggling to achieve desired/optimal mite control. Please monitor your mite levels and consider using a suitable mite control product immediately before the weather gets too cold. The next 10 days (Oct 11 to 20) look OK (if not ideal) to use one of the following products: formic acid (FORMIC PRO) or Thymol (Apiguard) to get some last minute mite clean up. Later on please also consider oxalic acid treatment if needed when there is no brood (possibly during November). Oxalic acid is approved by EPA and is available from the bee supplier Brushy Mountain Bee Farm (http://www.brushymountainbeefarm.com/?gclid=CLzrqIrB98cCFUiEfgods-gJ6w). Following are some consequences of inadequate or no Varroa mite control this fall:
- Bee population may decline significantly or the colonies might totally collapse during December/January.
- Colonies that survive the winter will start upcoming year / season with higher mite loads and hence could reach damaging levels soon by late spring or summer.
- High mite infested colonies may contribute to higher mite drifting via robbing bees to other beekeeper colonies and your existing healthy colonies, as your mite infested dead colonies may be robbed by other strong colonies and aid in greater mite dispersal.
Also, please continue feeding protein to your colonies if pollen stores are not adequate in the colonies. Protein feeding not only helps with brood rearing, but also helps boost the immune system of bees. We have observed colonies to consume protein until October 25 in the Willamette valley and few other locations in Oregon when the weather is still OK (temperatures around 55 to 60° F). Thank you and good luck. Source: https://orsba.org/varroa-alert ——
Bee symposium generating a buzz in Kelowna
UBC Okanagan is hosting an international bee symposium Oct. 12 to 14
A bee symposium held in the Kelowna next week is generating buzz about what we can do to help the local bee population.
In Vernon, a beekeeper was concerned for his bees after a large number of them died. At the time, he suspected it was a virus.
Keynote speaker Victoria Wojcik, research director the Pollinator Partnership, said it’s difficult to determine the actual cause of bee deaths, but pesticides play both a short long-term role.
In her presentation, Wojcik will be giving an overview of the program Pollinator Partnership does Canada-wide, which promotes the use of native plants and gives a guide on which plants are bee friendly in the country’s many regions.
“The number one thing you can do to help bees is provide floral habitats,” she said.
To continue reading: https://www.kelownacapnews.com/news/bee-symposium-generating-a-buzz-in-kelowna/
——
Mexico’s new science minister is a plant biologist who opposes transgenic crops
Lizzie Wade
MEXICO CITY—In early June, evolutionary developmental biologist Elena Álvarez-Buylla received an out-of-the-blue phone call from the campaign of Andrés Manuel López Obrador, then the front-runner in Mexico’s presidential election, with a question. If López Obrador won, would she consider becoming the next director of the National Council of Science and Technology (Conacyt), the country’s science ministry and primary granting agency? “My first reaction was to say, ‘I can’t,’” recalls Álvarez-Buylla, a professor at the National Autonomous University of Mexico (UNAM) here. “I have a great passion for scientific research,” and she couldn’t imagine leaving the laboratory.
But after thinking it over for a few hours, her passion for public service took over. “I started to have a feeling that I couldn’t say no,” says Álvarez-Buylla, who founded and leads Mexico’s Union of Scientists Committed to Society (UCCS). “It doesn’t matter how big the personal sacrifice is. … This is a unique and historic moment” for Mexico.
López Obrador, a progressive populist, won the presidency in a landslide and will be sworn in on 1 December; Álvarez-Buylla is now preparing to leave the lab bench and assume her new role. She will be the president’s primary science adviser and determine priorities for Conacyt’s approximately $1.5 billion budget, which funds grants to scientists working in the public and private sectors and supports tens of thousands of Mexican students at home and abroad.
Many scientists are delighted that one of their own will lead Conacyt—most of Álvarez-Buylla’s predecessors were career administrators—and that she’ll be the first woman to do so. But critics worry about her opposition to genetically modified (GM) maize, which Álvarez-Buylla fears could spoil the country’s astonishing agricultural biodiversity. They also worry that in her commitment to socially relevant science, she may neglect basic research. A petition asking López Obrador to pick another director has gathered more than 1000 signatures.
“There’s not a clear boundary” between her research and her activism, says Rodrigo Álvarez Aguilera, a science teacher here and one of the petition’s organizers. Biochemist Luis Herrera Estrella, director of the National Laboratory of Genomics for Biodiversity in Irapuato, says Álvarez-Buylla is “a very good scientist” but calls her views on GM organisms “radical.”
Born into a family of scientists, Álvarez-Buylla studied plant biology at UNAM and received her doctorate from the University of California, Berkeley. She returned to UNAM in 1992, where she now runs several research groups. Colleagues praise her contributions to the understanding of plant root development and how plant genotypes influence their traits. “There’s no question that the research she does is fantastic,” says her former collaborator Chelsea Specht, a plant evolutionary biologist at Cornell University. “And her advocacy is based in very good research.”
That advocacy began after a 2001 Nature paper reported that genetic material from the cauliflower mosaic virus, a common addition to GM plants, had been found in native maize varieties sampled in Mexico’s southern state of Oaxaca—likely the result of cross-pollination from industrially grown crops whose origin remains unclear. The finding shocked many because of maize’s all-important role in Mexican history and culture. Maize domestication began here about 9000 years ago, and Mexico now boasts at least 59 native varieties, called landraces, each exquisitely adapted to regional environmental and climatic conditions. Some possess unusual characteristics; in August, for instance, researchers reported that a landrace from Oaxaca can fix nitrogen from the atmosphere with the help of microbes, a trait known from beans and other legumes but never before found in maize. The adaptation allows it to thrive in nitrogen-poor soils; breeding it into other maize varieties could be a boon for farmers and might help reduce fertilizer use. Other landraces may have useful adaptations as well.
Álvarez-Buylla led a team that confirmed the results of the 2001 study and has continued to hunt for transgenic DNA and any possible effects in Mexican landraces, work that helped her win Mexico’s National Science Prize in 2017. She says she has nothing against genetic engineering in itself; her team creates and studies GM plants in the lab, and such experiments should not be prohibited or restricted, she says. “I’m not a Luddite who is scared of technology.” But her own experiments have shown introduced genes can have unpredictable effects.
To continue reading: https://www.sciencemag.org/news/2018/10/mexico-s-new-science-minister-plant-biologist-who-opposes-transgenic-crops
——
Tybee Island bee deaths still a puzzle despite investigation
Mary Landers
In May, something killed off a large number of bees on Tybee Island. Despite a Department of Agriculture investigation, the cause of the die off is still unclear, but Tybee officials say they’re stepping up to protect bees with pollinator-friendly landscaping and more natural pest and weed control.
May’s die off was the second in just 13 months for beekeeper David Strickland, whose hives were nearly wiped out in June 2017 after Chatham County Mosquito Control failed to warn him of a planned spray. Strickland, who declined to comment Friday, pointed in May to pesticides applied to nearby Jaycee Park to kill fire ants as a possible cause this spring.
A neighbor’s hives were also affected, as was an observation hive at Tybee Island Maritime Academy. A Georgia Department of Agriculture investigation indicated Yates-Astro properly applied the fire ant killer called Fendona CS or cypermethrin and that Chatham County Mosquito Control likewise applied its mosquito larval control properly. The Department of Agriculture also analyzed the dead bees for those two chemicals only and detected the larvicide in all bee samples and the fire ant killer in some samples.
Director Jeffrey Heusel said Chatham County Mosquito Control had not begun spraying for adult mosquitoes when the May 9 bee die off occurred. Mosquito Control had applied its larval insect control, S-methoprene, or Altosid, to water where mosquitoes lay their eggs on April 25. That’s what the Department of Agriculture tested for and found in concentration that topped out at 3.33 parts per million. Heusel isn’t surprised they found it, but said he’s certain it didn’t kill the bees. That’s because it’s not a contact poison but acts as a hormone mimic to prevent larval mosquitoes from developing into adults.
“You can spray it on adults (mosquitoes) and it won’t have an effect on them,” he said. “This same product is listed by the World Health Organization as safe for use in drinking water.”
Altosid is a “biorational” pesticide, said Heusel, an entomologist.
“It targets specific species and does so so it can be used in areas that are environmentally sensitive,” he said. Bees are not closely related to mosquitoes and don’t have the same hormone receptors the agent targets, he said.
In its own press release, Yates-Astro claimed the Department of Agriculture found it “did not kill the bees.”
To continue reading: http://www.savannahnow.com/news/20181005/tybee-island-bee-deaths-still-puzzle-despite-investigation
——
Oshawa buzzing on pollinators
Dave Flaherty
Oshawa is set to take further steps to protect its increasingly endangered pollinator population.
Council has approved a plan for the city to become a ‘Bee City.’
An application will be sent to Bee City Canada, an organizations that has called on communities, schools and businesses “to take action to protect pollinators.”
Over the past decade, pollinator populations, especially bees, have decreased significantly.
A staff report attributes these declines to land fragmentation, habitat loss, use of pesticides, industrialized agriculture, climate change, harsher winters and the spread of pests and disease.
In May 2017, the Ontario Nature Youth Council asked the City of Oshawa to consider becoming a Bee City.
The Ontario Nature Youth Council is provincial network that advocates on behalf of conservation efforts and issues. It is made up of 90 youth members from 50 communities across the province.
The city has already undertaken several initiatives to aid in conserving and restoring pollinator habitats.
Formal pollinator gardens have been planted at city hall, the Legends Centre and the Rossland Road butterfly garden.
Community gardens all have areas with pollinator-friendly flowering trees, shrubs, perennials and annuals.
The city was also one of the first in Canada that moved to reduce the use of pesticides in favour of cultural practices.
As part of the Bee City application, Oshawa must commit to ‘create a healthy pollinator habitat, education about pollinators and celebrate pollinators.”
The city has also pledged to create summer programs that include education and participation in the development of pollinator garden and applying for any relevant grants.
There is no cost to the city to participate in the Bee City program.
Councillor Amy McQuaid-England called the application a “great step forward.”
She noted there are already many individuals that are “already doing substantial things” to protect the pollinator population.
“We all need to be conscious of this,” she stated, noting that without bees the harvesting o food becomes extremely difficult.
Source: https://oshawaexpress.ca/oshawa-buzzing-on-pollinators
——
Native bees do it better
Kaite Fletcher
A native bee wraps its hind legs around a flower and vibrates its wings to unlock the flower’s hidden treasure –pollen. Its fuzzy body coated in yellow, the bee flies off to discover its next pot of gold.
This technique of shaking the flower’s pollen sacs, is called buzz pollination. It’s exclusive to wild, native bees and cannot be done by domesticated honeybees. The nation’s buzz about bee decline often forgets these key pollinators.
A top producer of the nation’s fruits and vegetables, Arizona farmers could take a major hit if native bee populations continue to decline.
“There are a lot of cases where honeybees cannot do the job of pollination in an agriculture setting,” said Kathryn Busby, a University of Arizona graduate student in entomology. “Certain types of plants require buzz pollination. Native bees just do it better.”
Native bees include bumble bees, Mason bees and carpenter bees.
Arizona holds the highest diversity of bees in the country, said pollination ecologist Stephen Buchmann, with 1,300 species that call the state home. Honeybees represent only a small number of those species.
To continue reading: http://arizonasonoranewsservice.com/native-bees-do-it-better
——
Witte Museum Opens The Birds and the Bees
Kathleen Petty Without pollinators, Texans wouldn’t have tequila, chocolate or those iconic spring bluebonnets.
That’s what the Witte Museum’s chief curator, Amy Fulkerson, wants visitors to think about when they see the museum’s latest exhibition, The Birds and the Bees: Pollinators in Nature, Science and Culture, which opens today, Oct. 5.
“Really what we would love for people to take away from this is that the things we see in our everyday lives, whether flowers or trees, that pollinators are a part of that,” Fulkerson says. “We need to pay attention—not just walk by.”
To continue reading: https://sanantoniomag.com/Online/October-2018/Witte-Museum-Opens-The-Birds-and-the-Bees
——
FROM CATCH THE BUZZ
- POLLEN TRAPPING AND FEEDING SUGAR SYRUP ENHANCES POLLEN COLLECTION OF LESS PREFERRED FLOWERS
Abstract
Pear (Pyrus bretschneideri) is characterized by being self-incompatible and dependent on cross-pollination to set fruit. Honeybee (Apis mellifera) is considered the most important pollinator of pear. Nevertheless, limited pollen transfer has been cited as the main cause of poor fruit set in many pear orchards. Here, we tested the following hypotheses: (i) colony manipulations increase the pollen collection tendency of honeybees and (ii) the proportion of pollen loads being returned to the hive is from the target plant. The technique reliably and rapidly estimates the pollination of honeybees tested under different colony manipulations: (1) using pollen trapping (PT); (2) PT with sugar syrup feeding (SS) (PTSS); (3) SS alone and (4) control without PT and SS. The results clearly show that the pollen collection of honeybees during the experiment was significantly affected (P < 0.05) by colony manipulations. The mean amount of pollen harvested daily was higher for PTSS (19.4 g) and PT (16.4 g) than for SS (12.85 g) and control (8.7 g) colonies. Therefore, PTSS was the most effective treatment for increasing pear pollen collection; other treatments such as PT and SS could also be useful. This study was important for determining how the behavior of honeybee colonies is shaped through colony manipulation to enhance pollen collection of less preferred pear flowers, which is critical when pollination is required.
https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0203648
- BAYER FORMS THREE-PRONGED STRATEGY, SEED TRAITS, CHEMICALS, AND DIGITAL AGRICULTURE FROM MONSANTO
Gil Gullickson
Bayer started integrating Monsanto roughly a month ago after buying it earlier this year.
So what’s happened so far? Bayer CropScience executives discussed some of the plans they have at this week’s Future of Farming Dialogue meeting at its Monheim, Germany headquarters.
Bringing Monsanto on board gives Bayer Crop Science a three-pronged innovation strategy, says Liam Condon, Bayer Crop Science chief executive officer.
It includes:
- The former Monsanto’s seeds and traits business
- Bayer’s chemical business
- The former Monsanto’s digital agriculture business (The Climate Corporation)
Bob Reiter, who heads research and development for Bayer Crop Science, says the two companies working together should speed up the time to market for agricultural products. Normally, Bayer would spent 12 to 14 years developing and commercializing a new herbicide.
Simultaneously, Monsanto would be working on a biotech (seed) solution to develop a herbicide-tolerant crop that allows a certain chemistry to be applied to it. “That would add 10 years to an innovation life cycle,” Reiter says.
Joining forces will help speed a product to market faster, as both technologies could be developed on a parallel track.
“It could literally allow us to simultaneously launch the crop protection product at very same time as the seed product,” Reiter says.
* Digital agriculture loomed large in Bayer’s decision to buy Monsanto. The knock against digital farming is a resulting “paralysis analysis” in that it generates reams of data with little guidance in how to use it. A tool unveiled last month by The Climate Corporation may change that. The Seed Advisor uses an algorithm that takes the farmer’s data and uses it to help him or her select hybrids on that basis.
Results in 2016 were promising, says Mike Stern, who heads The Climate Corporation and Digital Farming for Bayer.
“We placed the right hybrids in the fields and won 80% of the time (vs. those not selected by using the Seed Advisor),” says Stern. “Every year with more data, the algorithm gets better.”
Results are promising for 2018 testing across 100,000 acres. So far, favorable numbers are above 2016 results.
Bayer’s big into sustainability, as it aims to follow a number of sustainability goals.
”It makes tremendous sense to invest in food security in a sustainable manner,” says Condon. “Bayer is a business. But we are a business that can make science for a better life. Everybody in this company wants to contribute to a better way of life, and the way we do it through science and innovation.”
You won’t find many deniers of climate change at Bayer Crop Science.
“What if the planet keeps getting warmer and warmer, as every scientist says will happen?” asks Condon. “What does that mean for the future of water (for crop production) going forward? In Germany, we’ve seen a hot summer have an impact in (crop) fields. People will say, ‘Well, it is just one year.’”
Or not. Warmer summers over time may instead signal a changing climate in a region.
“This will put incredible pressure on plants,” says Condon. That’s why Bayer is working on solutions for crops to withstand stressors like drought and excessive heat, he says.
Microbes are hot.
Last March, Bayer formed a joint venture with a Boston firm called Gingko Bioworks to form a new venture called Joyn Bio. Condon says the new firm uses synthetic biology to engineer microbes that benefit crop growth. So far, the microbes Joyn Bio is keying on aim at improving nitrogen (N) fixation to reduce the amount of commercial N applications. If products like these come to fruition, it will be a disruptive agricultural technology, says Condon.
Gene editing is also hot.
Bayer Crop Science and a new start-up called Pairwise formed a joint gene editing collaboration earlier this year. It will use tools like CRSPR-Cas9 to produce new gene-edited crop products.
“This is technology I believe that in the long run will fundamentally reshape plant breeding,” says Reiter.
Bayer plans to identify new molecules to protect crops against pests.
It is collaborating with a German company called Targenomix that identifies the mode of action of bioactive small molecules. The firm uses various genomic tools to better understand how various molecules affect plants. The hope is it will discover new modes of action in products like corn and soybean herbicides, say Bayer executives. The last mode of action in corn and soybean herbicides to be discovered were the HPPD inhibitors (Callisto, Balance Flexx) in the 1980s.
- Revered as a Humanitarian and Scientist, Warwick Kerr was also blamed for the introduction of aggressive Africanized bees to the Americas
Brazilian entomologist Warwick Estevam Kerr died on September 15 in São Paulo at age 96. Kerr leaves behind a complicated legacy, on the one hand maligned for the introduction of aggressive Africanized bees in the Americas and on the other revered in his homeland as a humanitarian.
Upon his death, the city of Manaus in the state of Amazonas observed three days of official mourning as a tribute to Kerr’s work in improving the welfare of the people in the rainforest, and the Brazilian media honored his legacy in Brazilian science, research, economy, and education.
“It’s really interesting to see the important media outlets talking about [Kerr’s] death and how big a loss it is for the country, not just for science,” says Cristiano Menezes of the Brazilian Agricultural Research Corporation, a government agency. He was Kerr’s last student at the Federal University of Uberlândia.
“He was a fantastic, high-quality researcher, a fantastic human being, [and] with his personality he would make people around him better citizens,” Menezes tells The Scientist.
Born on September 9, 1922 in São Paulo, Kerr was originally trained as a plant breeder at the Luiz de Queiroz College of Agriculture (ESALQ) of the University of São Paulo. His PhD was on a Brazilian native stingless bee species, and after graduating in 1947, he continued his work on those bees until he was awarded a fellowship from the Rockefeller Foundation in 1951 to work at Colombia University with geneticists Theodosius Dobzhansky and Sewall Wright. Upon returning to ESALQ in 1954 and until he left the institution in 1958 to start a biology department at the State University of São Paulo, Kerr was laying the foundations for his future contributions to the Brazilian agronomy.
During this time, he was in search of more-productive pollinators because the European bees that were often imported into Brazil from Portugal were not good enough in the Brazilian environment. This led Kerr to Africa. He traveled to Tanzania and South Africa in 1956 and brought back 51 queens of the aggressive African honey bees to cross them with European bees in the hopes that the hybrids would be better honey producers. But in 1957, when one of Kerr’s hive managers accidentally opened excluders that separate queen bees from drone bees, about 26 queens of the aggressive African bees escaped, mated with European bees out in the wild, and produced aggressive offspring.
Eric Mussen, an extension apiculturist at the University of California, Davis, has said that Kerr’s intentions were good. Kerr “hoped that the gentler European bees would ‘mellow out’ the African bees’ strong defensive behavior, [but] in this case, he misjudged.”
The Africanized bees, dubbed killer bees, caused problems as they crossed into Central and North America over the following decades, killing hundreds of people.
“Professor Kerr took it on his shoulders,” says Lionel Segui Gonçalves, a visiting professor at the Federal Rural University of the Semi-Arid Region (UFERSA) in Brazil. “He was upset and felt responsible, so we began to study the behavior of these bees to better manage them,” recalls Gonçalves, who worked with Kerr for more than a decade on the Africanized bees at the State University of São Paulo, where he and Kerr also began coaching beekeepers to manage these bees.
“Africanized bees were a key to Brazil’s improved agriculture and honey production since these are naturally resistant to varroa mites that often clear colonies of European bees, beekeepers in Brazil nowadays use only Africanized bees.”
Kerr was also known as a humanitarian, boldly calling out the political and civil violence committed by soldiers when Brazil was under military rule during mid-20th century. For instance, he was once arrested for his opposition to the military soldiers who raped a Brazilian activist nun. Kerr also objected to the military regime’s association with the carmaker Volkswagen in clearing thousands of hectares of the Amazon forests. On another occasion, Kerr and his students at the University of Uberlândia worked to save several nests of a native stingless bee that was in danger of extinction from a hydroelectric project in Uberlândia.
“People in Brazil talk more about his contribution to Brazil than his Africanized bees,” says Menezes.
Over the course of his career, Kerr was the first scientific director of the São Paulo State Research Foundation (FAPESP), the director of the Amazon National Research Institute (INPA), and rector of the State University of Maranhão (UEMA). He founded the department of biology in the Faculty of Philosophy, Science and Literature in the State University of São Paulo at Rio Claro, of medicine at the University of São Paulo at Ribeirão Preto, and of biology in the Federal University of Maranhão.
Kerr also served as president of the Brazilian Society for the Progress of Science (SBPC) and the Brazilian Society of Genetics (SBG). As a member of the Brazilian Academy of Sciences (ABC), Kerr was the first Brazilian scientist to become a member of the US National Academy of Sciences in recognition of his scientific productivity.
- CHINESE PRODUCERS EXPECTED TO BEAT US TARIFFS BY REROUTING GOODS. EXPERTS SAY PRACTICE IS ALREADY WIDESPREAD
HONG KONG — As the trade war between China and the U.S. festers, business leaders and analysts say Chinese producers are likely to circumvent import tariffs by rerouting goods, raising the question of whether such taxes can be an effective way to equalize trade relations.
U.S. President Donald Trump won the election in 2016 in part due to a pledge to make trade fairer for his country. In January, he took Beijing to task by announcing tariffs on Chinese washing machines and solar panels. By Sept. 7, Trump told reporters he was ready to slap tariffs on an additional $267 billion in Chinese goods. This was on top of an earlier announcement of duties on $200 billion in imports the Trump administration was already considering.
As both countries fling threats at each other, analysts say that Chinese producers and manufacturers could already be getting ready to beat the system.
“In the short term, trade regulation volatility like this always leads to ‘workarounds,’ or cheating, for some period of time, especially as many of these products have very low margins so a 10% import tariff can wipe out any profit for the manufacturer,” said Dane Chamorro, a Singapore-based senior partner of Control Risks, an international risk consultancy.
“The chances of this (cheating) are high because supply chains take time to adapt, they cannot be re-established overnight,” said Chamorro, who has worked with supply chains involving factories in China.
A case in point is the Chinese honey industry. China is the biggest producer of honey but its companies have come under U.S. antidumping duties since 2001.
For years, these Chinese companies got around the rules by shipping large unlabeled barrels of honey to Thailand and Vietnam. The honey is then put into jars with labels that state their origin as these Southeast Asian countries. The jars of honey are then shipped from Thailand and Vietnam to the U.S. without incurring antidumping duties, said an industry source. “It’s happening a lot even now.”
The plywood industry is another example. An executive of a risk consultancy told the Nikkei Asian Review, “We have followed shipments of plywood from China and taken photos of them being unpacked and repacked at Vietnamese factories into boxes marked with the Vietnamese company for onward transit to the U.S.”
Mark Michelson, chairman of Asia CEO Forum, said he expects this practice to spread among small and medium-sized manufacturers of electronics in Hong Kong, if the U.S. does widen its scope of tariffs.
But others said that U.S. authorities will wise up to the cheating. Willy Lin Sun-mo, chairman of Hong Kong Shippers’ Council, said he expects “black sheep in the market” to try to circumvent the U.S. duties by cheating, given that it takes time to establish operations outside of China.
He added, though, that U.S. customs will notice any sudden surges in shipments of products from countries such as Vietnam, especially if those goods used to be imported from China. It is rare for established brands to suddenly switch to buying from a new factory in a new country, after sourcing for a long time from factories in China, he said.
The U.S. International Trade Commission said in a report to Trump on in November that crystalline silicon photovoltaic cells made in China, which were subject antidumping taxes from 2012, were moved to Taiwan and through other countries before landing in America to avoid import duties.
The U.S. subsequently widened those duties to cover all crystalline silicon photovoltaic cells from mainland China and Taiwan. But the affiliates of those Chinese manufacturers in South Korea, Malaysia, Thailand and Vietnam simply ramped up shipments to the U.S.