TRADE UPDATE

Food & Agriculture
January 23, 2024

By Kristy Goodfellow, Vice President of Trade and Industry Affairs

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HIGHLIGHTS

  • CRA: Join the CRA Team! We’re looking for a Sr. Director of Communications & Public Affairs to develop and execute strategic communications plans and join our team of leaders.
  • U.S. – China: On Jan. 18, the United States and China convened the Joint Committee on Cooperation in Agriculture. USDA Secretary Vilsack met with People’s Republic of China Minister of Agriculture and Rural Affairs Tang Renjian, and discussed “outstanding market access issues” and approaches to tackling climate change and food security challenges.
  • U.S. – Canada: On Jan. 17, USDA Secretary Tom Vilsack met with Canadian Minister of Agriculture, Lawrence MacAulay, who raised issues with USDA’s voluntary country of origin rulemaking for meat and livestock, and California’s Proposition 12.
  • World Trade Organization: Agriculture special session negotiations were held on Jan. 16 and 17. Discussions on a permanent solution for public stockholding for food security purposes or the special safeguard mechanism continue, among others.
  • Regional Trade Agreements: Presidents of Japan and Brazil advance the discussion on a commercial agreement between Mercosur and Japan.
  • Trade Remedies:
    • On Jan. 16, the U.S. ITC gave notice of the review of anti-dumping (AD) and countervailing duty (CVD) order on ripe olives from Spain. A World Trade Organization (WTO) panel found aspects of the U.S. AD/CVD to be inconsistent with WTO obligations in DS577.
    • On Jan. 12, the Department of Commerce issued a new duty rate on Moroccan phosphate as part of the remand order from the Court of International trade. The rate was reduced from 19.97% to 7.41%.
  • Export Data and Analysis: USDA’s Jan. 12 Livestock and Poultry report highlights the tightening of competition between the United States and the EU for pork exports.

“Canada and the U.S. have a bond like no other in the world. My discussion with our American partners highlighted the important and unique agricultural partnership between our countries. This is a connection based on shared geography, common values, mutual interests and economic ties, with the shared goal of building a sustainable agricultural sector that strengthens our rural economies, and feeds folks around the world.”

—The Honorable Lawrence MacAulay, Minister of Agriculture and Agri-Food Canada

CRA IS HIRING

Join the CRA Team! We’re looking for a Sr. Director of Communications & Public Affairs to develop and execute strategic communications plans and join our team of leaders.

The Sr. Director, Communications & Public Affairs is a proactive leader with strong strategic, writing, and project management skills. The Sr. Director is responsible for branding, positioning, messaging, budget, and making communications a robust element of CRA and PBPC advocacy. The Sr. Director reports directly to the CRA President & CEO and works in close collaboration with the CRA Sr. V.P. for External Affairs and the Executive Director of the Plant Based Products Council.

Learn more on our website.

U.S.-China

U.S. AND CHINA HOLD FIRST JOINT COMMITTEE ON COOPERATON IN AGRICULTURE MEETING SINCE 2015

  • On Jan. 18, the United States and China convened the first Joint Committee on Cooperation in Agriculture since 2015.
  • In addition to the Joint Committee on Cooperation in Agriculture meeting, USDA Secretary Vilsack met with People’s Republic of China Minister of Agriculture and Rural Affairs Tang Renjian. 
  • As stated in USDA’s press release, the leaders addressed “outstanding market access issues,” but also discussed approaches to tackling climate change and food security challenges.
  • The U.S.-China Business Council (USCBC) facilitated a meeting between Minister Renjian and the American agricultural and business community in Washington. In the USCBC press statement, they note:
    • “We are encouraged to see increased bilateral exchanges in agriculture between the US and Chinese governments.”
    • “We look forward to future exchanges between the US business community and China to build trust and expand cooperation in agriculture and other areas between both countries.”
  • On Jan. 19, Reuters reported that USDA “confirmed private sales of 297,000 metric tons of U.S. soybeans to China, the first soybean sales announcement under its daily reporting rules since Dec. 19 and the first to the world’s top buyers of the oilseed since Dec. 15.”

U.S.-Canada

USDA SECRETARY TOM VILSACK MET WITH CANADIAN COUNTERPART LAWRENCE MACAULAY

  • In the Agriculture and Agri-Food Canada (AAFC) Jan. 18 press release on  Minister MacAulay’s visit, Canada raised concerns that the voluntary “Product of USA” labelling regulations for meat and livestock, and California’s Proposition 12, both “have the potential to restrict trade and disrupt supply chains.”
  • AAFC also reports that the leaders discussed sustainable agriculture and working together to accelerate global agricultural innovation on climate change, through increased research and development.
  • Minister MacAulay also had meetings with the National Cattlemen’s Beef Association (NCBA) and the Canadian Cattle Association (CCA) to discuss reducing trade barriers.
From @SecVilsack on X.

World Trade Organization

AGRICULTURE NEGOTIATIONS HELD IN LEADUP TO MC13

  • Agriculture special session negotiations were held on Jan. 16 and 17.
  • According to the Washington Trade Daily, the negotiations chairman is expected to issue draft text on possible MC13 outcomes, although there does not appear to be significant consensus building on issues under discussion – including a permanent solution for public stockholding for food security purposes or the special safeguard mechanism.
  • Documents discussed included a revision to a domestic support paper submitted by the Cairns Group and Ukraine; a draft ministerial decision on export restrictions submitted by the UK; a draft ministerial decision on promoting agricultural production and trade in NFIDCs and LDCs submitted by the Africa Group; and a product-specific domestic support examination, calculator, and next steps, submitted by Canada and New Zealand.
  • In further regard to the 13th Ministerial Conference (MC13), WTO Deputy Director General (DDG) Elland noted these priorities:
    • the desire to conclude a second wave of negotiations on fisheries subsidies and ensuring the entry into force of the Agreement on Fisheries Subsidies;
    • dispute settlement reform; and
    • extending the moratorium on the imposition of customs duties on electronic transmission.
  • DDG Elland’s comments on agriculture negotiations did not express optimism. “[N]egotiations on agriculture continue, with many members pointing to food security as an important priority.  However, the talks remain difficult as members have different views on issues such as public stockholding for food security purposes, domestic support and market access.”
  • According to a U.S. press release, the U.S. delegation stated that: “The United States remains willing to engage on public stockholding for food security, but this can only be done in the context of broader domestic support negotiations, and these must be done in the context of broader agriculture negotiations where the overall outcome is in the direction of reform.”

Regional Trade Agreements

MERCOSUR AND JAPAN ADVANCE DISCUSSION ON TRADE AGREEMENT

  • Japanese Prime Minister Fumio Kishida and Brazilian President Luiz Inacio Lula da Silva discussed the possibility of a Japan-MERCOSUR trade agreement by phone on Jan. 10. 
  • Several news sources highlight Japan’s aggressive plan for engagement in Western Hemisphere trade planned for 2024.
  • Although the summary of the phone call (or, “summit”) by the Ministry of Foreign Affairs of Japan did not specifically reference the discussion about Mercosur, it did note that “the two leaders also committed to discuss various ways to strengthen economic relations, including further trade and investment promotion.”
  • Leaders also discussed working together on environment and climate change, and generally on the G20, which is being hosted by Brazil this year.

Trade Remedies

U.S. INTERNATIONAL TRADE COMMISSION (ITC) GIVES NOTICE OF REVIEW OF DUTIES ON SPANISH OLIVES

  • On Jan. 16., the U.S. ITC gave notice of the review of antidumping (AD) and countervailing duty (CVD) order on ripe olives from Spain. 
  • Person wishing to participate in the review must file an “entry of appearance” withing 45 days of the publication of the notice. 
  • You will recall that a World Trade Organization (WTO) panel found aspects of the U.S. AD/CVD to be inconsistent with WTO obligations in DS577. 
  • Notably, the panel found Section 771B of the 1930 Tariff Act to be as such inconsistent with Article VI:3 of the GATT 1994. Section 771B requires that USDOC presume the entire benefit of a subsidy provided, in respect of a raw agricultural input product passed through the downstream processed agricultural product and considered in CVD calculation.
  • In 2022, the United States informed the WTO Dispute Settlement Body that it would implement the recommendations and findings of the DSB.
  • The EU alleges that the United States has not come into compliance, and a compliance panel is expected to issue a final report in the first quarter of 2024.
  • This trade dispute is frequently raised in high-level bilateral discussions, including between President Biden and Spanish Prime Minister Pedro Sanchez.

U.S. DEPARTMENT OF COMMERCE LOWERS MOROCCAN PHOPHATE DUTY

  • On Jan. 12, the Department of Commerce issued a new duty rate on Moroccan phosphate as part of the remand order from the Court of International Trade (CIT). 
  • The rate was reduced from 19.97% to 7.41%.
  • The International Trade Commission (ITC) upheld their positive determination of material injury to the domestic industry.
  • The CIT will now review each determination and make a final ruling.

Export Data and Analysis

USDA LIVESTOCK AND POULTRY REPORT SHOWS EU AND U.S. PORK EXPORTS AT SIMILAR LEVELS

  • USDA’s Jan. 12 Livestock and Poultry report highlights the tightening of competition between the United States and the EU for pork exports.
  • The report states that “revised 2024 shipments by U.S. and EU, the world’s top two [pork] exporters, are nearly on par for the first time since 2015.”
  • The report attributes lowering of export estimates for both countries to slowdown in demand from China.
  • The report states that:
    • In addition, EU production has declined in recent years and is revised 2%  lower in 2024, tightening exportable supplies.
    • Forecast growth in U.S. production and lower prices are expected to underpin U.S. exports competitiveness in several markets.