Published: Sat, May 13, 2017
Business | By Pat Ferguson

Trade deal feeds China taste for beef, won't close deficit

Trade deal feeds China taste for beef, won't close deficit

"USMEF welcomes today's announcement that the United States and China have reached a high-level agreement that will allow USA beef to re-enter the Chinese market after a prolonged absence of more than 13 years". The give-to-get described by officials included a deal to open the USA market to cooked poultry from China, and Beijing committing to allowing US beef to enter its market before the end of the summer, capping a standoff for the latter product that goes back more than a decade.

The trade deal marks a stark contrast to the rhetoric of President Donald Trump during the campaign trail previous year, where he repeatedly lambasted China for unfair trading practices. "At this point the domestic players are well entrenched so foreign companies will have a hard time entering the China market", he said.

"[Ross] has launched similar "Section 232′ reviews of the US steel and aluminum sectors, where a flood of imports especially from China has depressed prices, threatening the industries" long-term health", Reuters reported, noting that both reviews could result in metal import restrictions.

Vice commerce minister Yu Jianhua, one of China's top trade negotiators, was effusive in his description of the USA administration, something not often heard from Beijing.

The US administration was "excited" about Washington's trade policies, said US Treasury Secretary Steven Mnuchin as he arrived for a meeting of G7 finance ministers in Italy.

Shares of Tyson Foods Inc (TSN.N), which sells both beef and chicken, rose 0.8 percent, while Pilgrims Pride Corp (PPC.O), the No. 2 US chicken producer, fell 1.3 percent.

"It's another encouraging sign that Trump's willing to cooperate with China rather than adopt the confrontational and protectionist stance he threatened during the election", said Julian Evans-Pritchard, an economist at Capital Economics, about Thursday's agreement.

The US Meat Exporters Forum welcomed the high level agreement to allow US beef to re-enter the Chinese market. Not a breakthrough The US trade deficit with China was $347 billion previous year.

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"It's at least a $2.5 billion market that's being opened up for USA beef", Ross said.

A number of US companies are seeking permits to build facilities to process liquefied gas, which would allow America to become a net exporter of gas, something it has not been since the 1950s.

The US and China have announced agreements on trade in beef, poultry, natural gas and financial services in a deal highlighting the surprisingly good relations which have been fostered between the leaders of the two super powers.

"Commerce Department trade data showed that "Semiconductors and related device manufacturing" had a trade deficit of $2.4 billion in 2016, with exports of $43.1 billion and imports of $45.6 billion", Reuters reported, noting that the data also includes solar cells, LEDs, and some raw materials.

Li Suling, 55, who works for an airline in Beijing, said allowing American beef imports was "a good thing" because it's more tender than Chinese-raised beef and less of a safety issue. China's growing wealth has made it the world's fastest-growing beef market, with consumption more than 20 times what it was five years ago. It will also lower long-standing barriers that have affected matters ranging from agriculture to the operation of American financial firms in China.

"This should lead to full and prompt market access", according to a Commerce fact sheet describing the initial commitments.

Visa said in an emailed statement it looked forward to submitting an application for a bank-card clearing institution license, which, "once granted", would allow it to support economic development in China.

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