Few, if any, U.S.-born chickens are going to be getting on a boat or plane for processing in China unless and until the little matter of tariffs totaling more than 135 percent goes away. And that may now be occurring, according to U.S. trade experts.
U.S. exports of 613,000 metric tons of broiler meat to China just four years ago collapsed by more than 90 percent after the People’s Republic of China (PRC) imposed the high tariffs. But, last week, it was U.S. Trade Representative Michael Froman who was doing the victory dance.
That’s because the World Trade Organization adopted the findings of its dispute settlement panel favoring the U.S., ruling that the duties on U.S. chicken “broiler” products violates international trade rules.
China now must bring itself into compliance with its WTO obligations. Four years ago, those who speculate about international trade actions said China’s imposition of the duties on U.S. chickens was likely retaliation for action taken against China’s so-called “dumping” of tires into the American market.
It was said then that while chickens and tires have little, if anything, to do with one another, there are so few categories of trade where the U.S. sells more than China that the PRC’s retaliation options were limited.
Four years later, China might be looking at chicken trade with the U.S differently. USDA just reaffirmed an earlier finding that China’s poultry inspection system is “equivalent” to its own and gave the green light to four Chinese processing plants to process cooked chicken for export to the U.S. so long as the live chickens are raised in the U.S., Canada or Chile.
Ambassador Froman said the WTO decision calling an end to the high tariffs is “a significant victory for American farmers and chicken producers and proves that the United States will not stand by while our trade partners unfairly hurt U.S. exports and U.S. jobs.”
He said China is accepting the decision without appeal, signaling that the PRC is taking a serious look at its trade remedies regime for chicken.
“China’s prohibitive duties caused a steep decline in exports of high quality U.S. broiler products to China, and with today’s news from the WTO, we look forward to seeing China’s market for broiler products restored for U.S. farmers and chicken producers,” said Secretary of Agriculture Tom Vilsack.
China’s Ministry of Commerce imposed the anti-dumping and countervailing duties on U.S. “broiler products” on Sept. 27, 2009. Broiler products include most chicken products except for live chickens and cooked and canned chicken. Duties were imposed on U.S. producers who cooperated with China’s anti-dumping investigation at rates from 50.3 to 53.4 percent, and for 105.4 percent for all others. The countervailing duties ranged from 4 to 12.5 percent for cooperating U.S. producers, and 30.3 percent for all others.
Two years later, the U.S. requested settlement consultations with China that were not successful, but that cleared the way for U.S. claims to be heard by the WTO. According to Froman, the WTO ruling favors the U.S. on nearly all claims.
The bottom line should be more normal chicken trade between the two nations.© Food Safety News