While China purchases have been a big part of the record U-S export figures USDA just announced, it has more to do with growing demand, than our trade relationship.
China fell short of its $200-billion Phase One obligations. But U.S. Meat Export Federation officials say it’s because they followed the commercial clause in the agreement, and if they hadn’t it would have distorted the market.
USMEF Senior Vice President for the Asia Pacific Joel Haggard says, “Yeah, they didn’t make the $200 billion, Okay, but would we in the meat sector, but also maybe people in the grain, soybean, would you have wanted Chinese state purchasers to go out and just buy that, just for the purposes of buying it to disrupt the market?”
And Former Ambassador to China Terry Branstad says Phase Two is unlikely to happen. “Because the Chinese government loves to subsidize their state owned enterprises, which are their champions and that’s market distorting. And it’s something that frankly didn’t get done in the Phase One agreement and I think it will be difficult to do.”
Branstad says the Biden Administration has not shown an interest in working on a Phase Two deal with China either which further complicates the issue.
