Tag Archives: China

China wants further talks as soon as the end of October to hammer out the details of the “phase one” trade deal touted by Donald Trump before Xi Jinping agrees to sign it, according to people familiar with the matter, Bloomberg News reports.

Beijing may send a delegation led by Vice Premier Liu He, China’s top negotiator, to finalize a written deal that could be signed by the presidents at the Asia-Pacific Economic Cooperation summit next month in Chile, one of the people said. Another person said China wants Trump to also scrap a planned tariff hike in December in addition to the hike scheduled for this week, something the administration hasn’t yet endorsed. The people asked not to be named discussing the private negotiations.

China has recently been buying a lot of meat. The Wall Street Journal says their recent purchases are pushing up the prices of beef, pork, and poultry around the globe.

Meat buyers are increasing their activity after African Swine Fever hit the country hard and reduced the size of the world’s largest pig herd by more than a third. Domestic pork prices have jumped in China and meat imports are rising in response and placing a strain on global meat supplies. For example, Brazil poultry shipments to China have jumped 31 percent compared to last year.

Retail prices for chicken breasts, thighs, and legs have increased roughly 16 percent. European meat buyers are paying five percent more for pork because more of their domestically produced supplies are heading to China. American shoppers haven’t felt the impact yet, but that may change.

Futures prices recently rose after Chinese officials say the country could exempt some U.S. pork and other agricultural goods from punitive tariff increases. Many American meat companies have watched as European and South American competitors have raced each other to supply China’s pork needs.

Trade talks continue this week between the U.S. and China as the U.S.-Mexico-Canada Agreement inches closer to reality. President Donald Trump says talks last week between the U.S. and China “were very positive.”

Negotiations will continue this week ahead of high-level talks planned sometime next month. A Chinese delegation canceled U.S. farm visits last week, but apparently not because of the ongoing trade negotiations. Officials say the trips were canceled to avoid excessive media attention. Meanwhile, Democrats in the House of Representatives plan to submit a counter proposal to the White House this week on changes to USMCA, according to Politico.

House Ways and Means Chairman Richard Neal says the USCMA working group would meet with U.S. Trade Representative Robert Lighthizer this week to “intensify the discussion.” Neal is hopeful the group and Lighthizer can “strike a deal soon,” that allows the House to vote on the agreement. Neal says the concerns raised by Democrats are not resolved but added the Trump administration has “made substantial progress.”

China’s government is releasing pork from stockpiles to help cool surging prices ahead of Oct. 1 celebrations of the Communist Party’s 70th anniversary in power.

The price of pork, China’s staple meat, has soared almost 50% from a year ago due to a devastating outbreak of African swine fever that killed or prompted authorities to destroy pigs. That has pushed up global pork prices as importers buy foreign supplies.

A government agency that manages the stockpile of frozen pork said Wednesday it will auction off 10,000 tons.

That is equivalent to less than 0.2% of China’s 2018 monthly consumption of 4.7 million tons, which suggests the announcement was a signal to consumers and farmers of Beijing’s determination to cool prices instead of an attempt to change supply levels.

China produces and consumes two-thirds of the world’s pork.

The government keeps reserves of live pigs and frozen pork to guarantee adequate supplies. Details of the frozen pork reserve are secret but industry analysts estimate its size at up to 3 to 5 million metric tons.

Industry analysts say the reserve probably is too small to have an impact on supplies in the market. The last release announced by the government was 9,600 tons in January.

This month, authorities also announced an initiative to revive pork production with support to farmers including subsidies to rebuild pig herds and improve facilities.

The Cabinet planning agency, the National Development and Reform Commission, promised Wednesday to take “control measures in a timely manner” to keep food prices steady ahead of the Oct. 1 celebrations.

“We will take the lead in formulating plans and measures to ensure a stable supply of pigs,” said an NDRC spokeswoman, Meng Wei.

The price surge is a sour political note for the ruling party, which bases its claim to power in part on improved living standards over three decades of market-style economic reform.

Pork output plunged as authorities destroyed herds and blocked shipments to stop African swine fever, which first was reported in August 2018 in China’s northeast.

African swine fever doesn’t harm humans but is fatal and spreads quickly among pigs.

August’s rise in pork prices pushed food cost inflation to 3.2%, above the ruling party’s official target of 3%.

Smaller outbreaks also have been reported in South Korea, Vietnam, Cambodia, Taiwan and Mongolia.

Forecasts of the decline in this year’s Chinese pork production range as high as 35%. The U.S. Department of Agriculture says Chinese imports might rise 41%.

The shortages have given a boost to American pork exports despite tariff hikes imposed by Beijing in a fight with Washington over trade and technology.

U.S. pork sales to China rose 150% in June over a year earlier to 72 million pounds (33 million kilograms), according to the USDA.

Chinese imports rose 26% in the first half of 2019 to 819,000 metric tons, according to USDA. The European Union supplied 62%, Canada 16% and American farmers 8%.

WASHINGTON, D.C., Sept. 13, 2019 – This morning, Chinese media reported that it was suspending the imposition of punitive tariffs on U.S. pork imports. The following is a statement from National Pork Producers Council President David Herring, a pork producer from Lillington, N.C.:

“If media reports are accurate, this is a most welcome development. The Chinese have placed punitive tariffs of 60% on most U.S. pork products, bringing the effective tariff rate on most U.S. pork to 72%.

“According to Iowa State University economist Dermot Hayes, the Chinese retaliation on U.S. pork has shaved $8 off the price of every hog sold in the United States for well over a year. Most of our competitors face only a 12% tariff on their pork exports to China. Pork is somewhat unique given that it is the most important protein consumed in China, accounting for a significant part of the consumer price index.

“Additionally, pork is in short supply in China because African swine fever has ravaged the Chinese hog herd and significantly reduced the production of pork. When you consider that China is the largest producer and consumer of pork in the world, the importance of this market to U.S. pork producers is clear. U.S. pork exports could single handedly make a huge dent in the trade imbalance with China. We are hopeful that this apparent gesture of goodwill by China leads not only to more sales of U.S. pork, but that it contributes to a resolution of U.S.-China trade restrictions.”

Negotiators from the United States and China will meet face-to-face next month. Chinese officials told reporters Thursday the agreement was reached in a phone conversation this week.

China’s Vice Premier visited over the phone Thursday morning with U.S. Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer. Following the call, China announced negotiators plan to travel to Washington next month for high-level talks, and will continue consultations through September ahead of the meeting in October.

The announcement from China comes as President Trump told reporters in the Oval Office this week that China wants to reach a deal with the United States. The U.S. Trade Representative’s office has yet to confirm the planned October meeting, but did say discussions will take place in the coming weeks.

The tit-for-tat trade war with China has dropped U.S. ag exports to China from more than $20 billion in 2017, to $9 billion last year. A breakthrough in negotiations would be welcome news for agriculture.