Here’s Why a Tough Stance on China Could Continue Under Biden Administration

China seems to be trying to win over the new administration. By Thursday last week, China purchased a record amount of corn in a given week. Then on Friday, USDA confirmed made its second largest purchase of corn ever.

Farmers for Free Trade thinks a Biden administration has the potential for a huge win with China, thanks to the groundwork already set.

“I'll give credit where credit's due with the Trump administration, and I think one thing they accomplished with the Phase One deal is they addressed a lot of the non-tariff trade barriers,” says Brian Kuehl, co-executive director for Farmers for Free Trade.

From breaking down barriers by eliminating some of the phytosanitary standards to other issues the Phase One deal addressed, Kuehl says it was non-tariff issues that bedeviled trade.

“I think Trump's use of a big stick and the tariffs brought china to the table and addressed a lot of those issues,” says Kuehl. “I don't think we'd want to see the Biden administration throw the Phase One deal out, even if China hasn't let lived up to its purchasing commitments.”

During U.S. Treasury Secretary Janet Yellen’s confirmation hearing in January, Yellen previewed how the Biden administration may address trade issues with China.

“Sanctions are a critically important tool to address cybersecurity and other threats, and you can be sure that I will be focused on making sure that they're used strategically and appropriately,” Yellen said during her confirmation hearing. “I intend to ask my deputy, if he's confirmed to quickly begin a review of our sanctions policy to make sure we're doing this in a strategic way and in the most effective way we can."

The National Pork Producers Council (NPPC) hopes the Biden administration can tackle strict tariffs. Those duties are something that Council says are crippling the U.S. pork industry, placing pork at an unfair advantage.  

“Another priority for our producers is to level the playing field in China and to eliminate the retaliatory duties that our producers still face for their products,” says Maria Zieba, who is director of international affairs for NPPC. “We're paying a 33% tariff on our pork products going into china while the rest of the world is paying 8%.”

Zieba says NPPC would like to see the new administration not only address, but eliminate those hefty tariffs.

“We do know how competitive our producers can be, and we do know how much exports we've had into china. But we still have to eat the cost of the tariff, which is very unfortunate for them.”

Tariffs are just one of the issues a new administration will have to face. Just this week, Bloomberg reported China’s President Xi Jinping called on officials to step up protection of intellectual property rights. China says protecting intellectual property is key to China’s opening up, national security and quality development.

Some economists in the U.S. called out China’s hypocrisy, saying China’s history of stealing U.S. intellectual property is something the Phase One agreement tried to address.

Washington insider Karla Thieman of the Russell Group thinks while Biden hasn’t shown his cards when it comes to how he plans to deal with China, she thinks the tough stance will continue. However, what drives those discussions may differ.

“I think they are still going to be holding china accountable,” says Thieman. “You've seen now President Biden talk a lot about labor standards and environmental standards, when it comes to China. And even looking at the United States presenting some pretty aggressive statements on climate and the environment to get China to be a better for next places.”

Even if climate and labor headline future discussions with China, she says cabinet confirmation hearings are giving a preview of Biden’s possible approach.

“The one thing he has said consistently is consistent with wishes aligned with how the Obama administration dealt with china,” says Thieman. “How do we leverage our allies, and have force in numbers to help force china to be a better trading partner and a better expert in the overall global trading space.”

Strength in numbers is a strategy some in the agriculture sector think could help build future trade pacts.

“I think a good lesson is America can't be unto itself, we're much stronger if we've worked with our allies,” says Kuehl. “If we can work with the UK and the EU, and other countries around the world to squeeze China, and to insist on things like intellectual property games, I think we're going to see, number one, a higher likelihood of success, and number two, we're going to cut down on the ability of our competitors like Canada to sell wheat while we're standing on the sidelines.”