“Uncertainty Looms for US Meat Exporters in China”
By Tom Polansek, Mei Mei Chu, and Laurie Chen
CHICAGO/BEIJING (Reuters) – The future looks uncertain for hundreds of U.S. meat plants that gained entry to China under the 2020 “Phase 1” trade agreement with President Donald Trump. These plants are at risk of losing their eligibility for exports to China, potentially impacting about $5 billion in trade to the largest meat market in the world amidst escalating trade tensions.
The potential loss of access to the Chinese market could have significant repercussions for American farmers, coming on the heels of Beijing’s recent imposition of retaliatory tariffs on approximately $21 billion worth of American agricultural products, including imposing 10% tariffs on U.S. pork, beef, and dairy imports.
In order to sell food products in China, exporters must register with customs. As per U.S. Department of Agriculture (USDA) records and Chinese customs data, registrations for nearly 1,000 beef, pork, and poultry plants, including those owned by major companies like Tyson Foods and Cargill Inc, are set to expire on Sunday. This accounts for about two-thirds of all registered plants. The companies have either chosen not to comment or have not responded to inquiries from Reuters.
Despite repeated requests from U.S. agencies, China has not renewed plant registrations, potentially violating terms outlined in the Phase 1 deal. The USDA has highlighted the expiration of these registrations as a critical issue in discussions with Beijing. The U.S. Meat Export Federation has expressed concerns over the uncertainty surrounding the situation and the risks associated with shipping products with impending expiration dates.
While there is no indication of a complete ban, Shanghai port has intensified inspections and documentation requirements for U.S. meat shipments. Some containers are now subject to thorough unpacking and inspection, leading to longer processing times and additional fees.
Although some plants have had their registrations extended until 2028 or 2029, there is growing apprehension among exporters about the potential impact if registrations are not renewed. The U.S. was China’s third-largest meat supplier in the previous year, accounting for 590,000 tons or 9% of total imports.
The “Phase 1” trade agreement aimed to resolve the initial U.S.-China trade dispute and included commitments from Beijing to increase purchases of U.S. goods and services, including meat, by $200 billion over a two-year period. However, China fell short of meeting the target due to the onset of the pandemic shortly after the agreement was reached.
According to the USDA, in the year of the agreement, 1,124 beef, poultry, and pork processing plants or logistic facilities were registered with Chinese customs for exports. While there are 1,842 certified facilities today, less than half will remain if registrations set to expire on Sunday are not renewed.
As per the terms of the Phase 1 deal, China is required to update its approved
The Meat Institute, a trade organization representing U.S. meat processors, is facing uncertainties regarding potential violations of current agreements due to delays. According to the U.S. Meat Export Federation, the repercussions of expired licenses could result in significant financial losses, estimated at up to $4.13 billion for the beef industry and $1.3 billion for pork. Exporters of products such as chicken feet and pork offal, which have lower domestic demand, would be particularly impacted by a loss of access to the Chinese market. This information was reported by Tom Polansek in Chicago, with contributions from Laurie Chen, Mei Mei Chu, Ella Cao, and Lewis Jackson in Beijing. The editing was done by Lewis Jackson and Shri Navaratnam.
