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Argentina bets on U.S. lemon exports as soured ties turn sweet

| BUENOS AIRES

BUENOS AIRES Oct 5 Argentina, the world's top lemon producer, is confident a 15-year ban on exporting the fruit to the United States will be lifted soon as government relations improve despite opposition from U.S. farmers, an Argentine official said on Wednesday.

The United States, the top lemons consumer, is evaluating an end to the ban amid a broader push from center-right President Mauricio Macri to boost agricultural exports after 12 years of isolation and leftist rule in Argentina.

"The sector has made the improvements they asked of us so that we can begin to export," said Guillermo Rossi, vice president of health and safety agency Senasa. He said in an interview that final approval should come before the next harvest in March or April.

The U.S. Department of Agriculture proposed a rule to allow imports in May and is reviewing public comments on it, a spokeswoman said. A U.S. delegation visited Argentina in September.

Officially, the U.S. import ban of 2001 has nothing to do with politics. Citrus farmers in California, which produces 90 percent of U.S. lemons, are concerned Argentine lemons carry diseases that could hurt their crops.

But the timing of the proposal to allow imports seemed political, said Joel Nelson, president of trade group California Citrus Mutual, noting that President Barack Obama had visited Argentina to meet with Macri in late March.

"This administration is seemingly rewarding an administration in Argentina for potentially good behavior," Nelson said. "They're using us as a trading chip."

Exports are expected to be modest, and farmers would likely replant trees to grow lemons of the quality expected by U.S. consumers, said Romain Corneille, chief executive of San Miguel , Argentina's top lemon exporter.

U.S. approval could help Argentina gain access to other markets such as China, said Jose Carbonell, the head of the citrus federation, noting that Argentina complies with the European Union's tough requirements.

Output from Argentina's vast pampas farm belt that supplies the world with grains and beef fell under former President Cristina Fernandez as she restricted exports to contain inflation.

Her policies depleted Argentina's foreign currency reserves, and more exports of fresh lemons and other crops could help build stocks from the current $32 billion.

Macri's government also removed export taxes on wheat and corn and lowered them for soybeans in an effort to boost shipments since taking over in December, and hopes the U.S. will also lift restrictions on Argentine beef imports. (Reporting by Luc Cohen; Editing by Caroline Stauffer and Grant McCool)

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