ADVOCACY REPORT Trade Negotiations on Summer Vacation Since this year’s almond crop is setting a record at three billion pounds, international trade takes on even more importance and requires sustained and increased attention. The majority of this year’s almond crop will be sold in export markets. Ensuring these markets stay open and progress is made on new trade agreements is a priority for your Blue Diamond team, however only time will tell if real progress can be made amid the current global pandemic. International trade continues to be uncertain and uneven for several reasons. First the coronavirus has disrupted many economies and has completely disrupted travel. It is no longer possible to travel to foreign markets to work to resolve issues that may occur in a specific market. This also prevents calling on customers in many markets. The border with Canada and Mexico is expected to remain closed through August, if not longer. This closure is for non-essential travel. Second, this continued uncertainty is caused by the actions currently being adopted by the U.S. and our trading partners. Almonds are currently subject to retaliatory tariffs in important export markets including China, India and Turkey. While there are ongoing negotiations to obtain removal of these tariffs, the progress has been slow. It is not possible currently to predict when these tariffs will be reduced or removed. Currently, there are ongoing negotiations to establish new trade agreements with the United Kingdom, European Union and Kenya. The United States-Mexico-Canada Agreement (USMCA) is now in force. Consideration of a trade agreement with Brazil is underway. A beneficial trade agreement was reached with Japan. This resulted in improved access to Japan. A second-round agreement with Japan will occur at some point which will further benefit the U.S. The U.S. is in the process of establishing retaliatory tariffs on all countries that have or are considering imposing a tax on digital services. A retaliatory tariff has already been announced against France’s digital tax but will not go into 2 4 A L M O N D F A C T S