U.S. Meat Trade Faces Ban From China Amid Expiring Licenses

The expiration of export licenses for U.S. meat packers to China poses a potential $3 billion risk to the industry. With escalating trade tensions, Australia stands to gain as it could become the primary source of grain-fed beef for China. U.S. exporters express concern over the implications of this situation.

The licenses for numerous U.S. meat packers to export to China are set to expire imminently, which poses a risk to the $3 billion trade in beef, pork, and poultry. If these licenses are not renewed, hundreds of American abattoirs may face a ban on exporting their products to this critical market. The U.S. Department of Agriculture has indicated that some registries have already lapsed, highlighting a lack of response from China Customs regarding rectifications.

According to Brett Stuart, director of Global Agritrends, export licenses were expected to auto-renew after five years. However, their failure to do so appears intentional. “So what we’re looking at right now in America, is waking up Monday morning and having $US3 billion worth of beef, pork and poultry no longer eligible to export to China,” he noted. This situation raises concerns whether it is a system glitch or a result of escalating trade tensions between the two nations.

China has already imposed retaliation tariffs on U.S. meat products, further complicating the scenario. Stuart emphasized that this lack of renewal could signify a deliberate political strategy on China’s part, stating, “The fear is, this is not a glitch in the system but a political strategy.”

The implications for Australia may be significant, as U.S. beef previously exported—170,000 tonnes in the last year—might need alternative markets. With the U.S. potentially sidelined, Australia could become the primary supplier of grain-fed beef to China. This development has reportedly led to a surge in orders from Chinese importers seeking Australian products, as noted by industry sources.

The Australian Meat Industry Council refrained from making immediate comments, preferring to monitor developments closely. Stuart noted that U.S. exporters are anxious about the potential for a de facto ban, stating, “And the real question is, how will President Trump react when he gets news that China has banned the entire US meat industry?”

In summary, the impending expiration of U.S. meat export licenses to China represents a critical challenge for the American meat industry, with potential losses amounting to $3 billion. Escalating U.S.-China trade tensions could lead to significant shifts, benefiting Australian beef producers as they may fill the void left by the U.S. Amid the uncertainty, industry stakeholders are closely monitoring the situation and considering the broader implications for both markets.

Original Source: www.abc.net.au