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President Signs Framework With China: Details Still Illusive, But Farmers Optimistic
SARA WYANT
WASHINGTON, D.C.
If you are looking for a lot of details about what’s in the trade deal with China in terms of purchases, you will need to keep watching sales announcements over the coming months to see if the promises materialize.
President Trump, along with Vice Premier Liu He, signed the agreement on Wednesday in front of a jam-packed crowd of farmers, ranchers, agri-businessmen and media.
The long-awaited signing ceremony provided several broad-brush statements about what was included, but few details. As we’ve previously reported, administration officials pledged that the Chinese would purchase roughly $40 billion in ag products in both 2020 and 2021.
There is a bit more “meat on the bones” in some fact sheets, which are available on the U.S. Trade Representative’s web site.
The documents confirm that China has agreed to purchase at least $40 billion in U.S. farm products annually over the next two years.
"Products will cover the full range of U.S. food, agricultural, and seafood products. On top of that, China will strive to import an additional $5 billion per year over the next two years," a summary says.
You can read an eight-page summary of the agreement on agriculture.
More fact sheets are available at the U.S. Trade Representative site.
The dramatic increase in purchasing of U.S. farm products that China has agreed to will be spread among a wide range of commodities and sectors, Agriculture Secretary Sonny Perdue told Agri-Pulse.
Perdue, who was speaking just ahead of the White House ceremony where President Donald Trump and Chinese Vice Premier Liu He were signing the “phase one” deal, said the deal would be implemented within 30 days and that China had agreed to ease restrictions on U.S. beef.
“We think we will begin to see trade flow quickly,” said Perdue.
He said that many commodities would be involved in the purchasing in order to reach the $40 billion in increased Chinese agricultural imports promised over the next two years.
“It’s intentional and purposeful that no specific commodities are outlined,” he said of the deal.
Perdue did note that, on beef, the Chinese had refused to accept beef from cattle that were older than 30 months. “That’s going to be relaxed,” he added. “There’s going to be a sanitary/phytosanitary relaxation of prohibitions that have inhibited all of our exports there.”
The Chinese also have a ban on hormones in beef, but Perdue said that’s going to change, too.
“They are going to accept hormone levels that are accepted by CODEX - just like other countries in the world. This is a big success for agriculture,” Perdue said.
On biotech, where other structural changes are expected, Perdue did not go into detail. However, he said they are agreeing to a timeline of regulatory approval which is different than they have ever had before.
Perdue also said that he is not expecting another round of Market Facilitation Program payments, “but obviously, we’ve got a third tranche of 2019 payments expecting to go out.”
Farmers like trade, not aid, he said.
Despite the lack of details, farm organization leaders were mostly positive about the opportunities. U.S. Meat Export Federation (USMEF) President and CEO Dan Halstrom said the following:
“For the U.S. pork and beef industries to expand their business in China, the world's largest and fastest-growing destination for imported red meat, it is critically important that China follows international standards for pork and beef trade. The Phase One trade agreement lays important groundwork toward this goal, and USMEF thanks the Trump administration for addressing the barriers that have hampered U.S. pork and beef exports to China for many years.
Last year China's red meat imports exceeded $14 billion, a 65 percent increase from 2018. The U.S. industry looks forward to capturing a greater share of this rapidly growing market.” ∆
SARA WYANT: Editor of Agri-Pulse, a weekly e-newsletter covering farm and rural policy. To contact her, go to: http://www.agri-pulse.com/
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