In comments submitted to the U.S. Trade Representative opposing the proposed modifications to the Section 301 actions, the Meat Institute called for comprehensive trade agreements as a long-term strategy to level the playing field for meat and poultry companies and to hold China accountable for its actions.

“The Section 301 tariffs and resulting retaliatory measures imposed by China have caused undue harm to U.S. agricultural exports, including meat exports. U.S. trade policy, such as the one proposed in this Section 301 action, should not inflict pain on domestic producers, companies, and workers, as this one has and will continue to do if implemented,” said Meat Institute President and CEO Julie Anna Potts in the comments. “Instead, restoring U.S. leadership in international trade through the pursuit of high-standard, comprehensive trade agreements that level the playing field for American companies and workers would be a more effective long-term strategy to counter the legitimate concerns USTR attempts to solve in this rulemaking. Market diversification initiatives, coupled with strategic competition with China, will lift all sectors of the U.S. economy without exacerbating tensions or existing economic hardship.”

The full comments are available here.

U.S. agriculture disadvantaged by Section 301 retaliatory actions

In 2023, China was the U.S. beef and pork industries’ third-largest value market and the U.S. poultry industry’s second-largest value destination.

China’s retaliatory tariffs accounted for 95% of agricultural export losses by 2019, totaling $25.7 billion. Pork exports declined precipitously, falling $646 million in annualized losses.

Pork exports disadvantaged by China’s retaliatory tariffs

Currently, U.S. pork exports to China face a 25% retaliatory tariff on top of the most-favored-nation rate of 8%, which has left the U.S. pork industry at a significant disadvantage compared to China’s other pork suppliers.

U.S. pork exports to China reached a record $2.28 billion in 2020, but subsequently declined to $1.7 billion in 2021, falling further to $1.36 billion in 2022, and finally decreasing again in 2023 to $1.24 billion, below previous estimates of $1.33 billion.

China reneges on commitments made in the U.S.-China Phase One Agreement

Barriers to trade remain, including China’s requirement that U.S. pork imports be accompanied by ractopamine-free certificates of analysis, even though all U.S. pork destined for China is being produced under ractopamine-free verification programs; China’s zero-tolerance policy regarding pathogens on the surface of raw pork and beef imports; and China’s ban on the use of Codex and FDA-approved beta agonists.

Although the Phase One Agreement has significantly simplified the establishment registration process for U.S. meat and poultry export facilities, China, for more than half of 2023, did not update the approved U.S. establishment list, nor did the country process administrative revisions to that list, failing to fulfill core tenets agreed to in the Phase One Agreement.

“A tit-for-tat exercise in tariff escalation does not make U.S. supply chains or key economic sectors, like agriculture, more secure or resilient,” said Potts. “Instead, such a policy increases costs for consumers, importers, and exporters, constrains the ability of small- and medium-sized companies to grow and compete in the global marketplace, and is antithetical to the Administration’s pursuit of a worker-centric trade agenda.”

Source: Meat Institute