BRYAN, Tex. (KBTX) - In 2018, the Trump Administration renegotiated a trade agreement with South Korea that opened markets for U.S. Agriculture. NAFTA has been renegotiated with Canada and Mexico and there are hopes for new agreements with the European Union, Japan, and China that will make markets more open to U.S. Beef. Erin Borror is an economist for the U.S Meat Export Federation.
“Japan, Korea, Mexico, China-Hong Kong, Canada. Taiwan is right in there too. Small country, amazing. Six consecutive record breaking value years for U.S. Beef, and talk about a market where we’re really penetrating. We have seventy-five percent of the chilled market and so really we dominate the highest value category in Taiwan.”
Borror is hoping for less tariff disadvantages for U.S. Beef, particularly in China and Japan.
“And so everyone has their normal tariffs that they charge. So in China, since we don’t have a free trade agreement, when we ship beef to China, normally we pay a twelve percent sales tax, call it. And now with the retaliatory tariff an additional twenty-five percent. They’re just added together, so it’s thirty-seven percent sales tax is what I have to pay now as an importer in China. And if I want to buy Australian Beef I pay six percent.”
Borror says the reason for that is that the Australians have a free trade agreement with China and they don’t have any metal tariffs on China.
“Canada is paying is still paying twelve percent. Australia is different because they have a free trade agreement, and so their tariff is being reduced to zero. Right now this year it’s six percent. New Zealand has a free trade agreement as well. They’re already at zero. Canada, Brazil, Uruguay, Argentina, the other big suppliers are at twelve.”
While the U.S. still has a competitive advantage with the quality and availability of beef cuts to export, the industry’s hope is that agreements will be made to level the playing field for market access.