New beef sales to China signal more trade to come after ‘phase one’

Chinese importers purchased 1,500 metric tons of U.S. beef earlier this month, evidence that the “phase one” trade deal is already resulting in new export opportunities for the U.S., according to new data from USDA.

“It’s definitely encouraging,” said U.S. Meat Export Federation spokesman Joe Schuele. “We’re cautiously optimistic.”

It was just about a month ago that USDA’s Food Safety and Inspection Service published a list of 492 U.S. plants — including facilities owned by Cargill, Tyson, Creekstone Farms and Iowa Premium — that can export beef to China. That was made possible after China agreed in the “phase one” deal to lift its zero-tolerance policy for growth hormone residues in beef as well as eliminate its ban on beef from cattle over 30 months old at slaughter and accept the U.S. traceability system.

“We don’t want to get too riled up over one weekly report, but we would expect to start seeing an uptick in activity now that we have more eligibility,” Schuele told Agri-Pulse. “There’s a lot more cattle eligible. There’s no doubt about that.”

Another positive development is that China is allowing importers to apply for exclusions to the country’s trade war tariffs on U.S. ag commodities, and Chinese beef buyers are already taking advantage of that.

“We know that some importers have had success with that,” Schuele said. “There’s no way to know exactly how many. We know some importers said they have successfully obtained duty exclusions.”

The one restriction China has not yet lifted is its zero-tolerance for beef treated with ractopamine, but negotiators are working with U.S. trade and ag officials to come to a new agreement, government sources tell Agri-Pulse.

“As cattle enter the feedlot, they’re pretty much all eligible for China now,” Schuele said. “If they’re on a feeding program that includes ractopamine, that would take them out of being eligible for China.”

Via Bill Tomson from AgriPulse