4/4/2018 12:00:00 AM
Iowa beef included in China’s proposed tariff hike
Iowa’s agricultural products, including beef, have become victims of a trade war meant to benefit the US manufacturing industry.
In addition to a 25% tariff on pork and ethanol that went into effect on April 2, the Chinese government announced a proposal to increase tariffs on US soybeans, corn and beef by 25%. The April 4 proposal was made in retaliation for tariffs levied by the Trump administration on Chinese products.
“The Chinese export market for beef has been growing since 2017, when US beef was allowed into China for the first time since 2003,” says Matt Deppe, CEO of the Iowa Cattlemen’s Association. “An additional 25% tariff, on top of the 12% tariff currently in place, definitely has the potential to slow that growth and ultimately, hurt our Iowa cattle producers.”
According to the US Meat Export Federation, US beef exports to China totaled 3,020 metric tons valued at $31 million in the second half of 2017, following the market reopening. In January 2018, exports reached the highest monthly volume to date at 819 metric tons, valued at $7.5 million.
“It’s not surprising that China retaliated through agricultural tariffs. The US truly feeds the world, and exports are an important market for farmers, especially in Iowa,” says JanLee Rowlett, Government Relations Manager for the Iowa Cattlemen’s Association. “These proposed tariffs have already affected corn, soybean and cattle futures, and our top priority now is ensuring that they do not go into effect. We are hopeful that the Trump administration can resolve this trade war before farmers are hurt any more.”
The Iowa Cattlemen’s Association policy, developed and ratified by its 10,000 members across the state, supports trade agreements that benefit beef producers. Following US withdrawal from the Trans Pacific Partnership, an agreement that included 11 other countries, including several major US beef importers, ICA’s focus has been on preserving the positive aspects of NAFTA and advocating for bilateral trade agreements, like the recently renegotiated US - Korea Free Trade Agreement (KORUS) which includes favorable terms for US beef exports to South Korea.
Iowa has over 27,000 cattle producers and is 4th in the nation for cattle on feed. The majority of Iowa’s beef producers are also corn and soybean farmers, and the tariffs on ethanol, corn, and soybeans are also concerning, given the current agricultural economy. US net farm income is expected to fall in 2018 for the 4th time in 5 years.
About the Iowa Cattlemen's Association: The Iowa Cattlemen’s Association represents nearly 10,000 beef-producing families and associated companies dedicated to the future of Iowa’s beef industry. ICA’s mission is “Grow Iowa’s beef business through advocacy, leadership and education.”