Japan's tariff increases on United States beef will harm relations, says USDA chief

Japan's tariff increases on United States beef will harm relations, says USDA chief

Japanese officials confirm rising imports of frozen beef in the first quarter of the Japanese fiscal year (April-June) have triggered a safeguard, resulting in an automatic increase to Japan's tariff rate under the WTO on imports of frozen beef from the U.S. The increase, from 38.5% to 50%, will begin Aug.1, 2017 and last through March 31, 2018.

Finance Minister Taro Aso announced the move today, saying he was prepared to explain the decision to the USA side.

Japanese officials said on Friday they were raising duties on US frozen beef exports to 50% from 38.5%.

The increase threatens a significant sector of the United States' access to the biggest Asian market for USA beef overall, just as President Donald Trump is trying to expand American exports to Japan.

As Australian beef is exempted from the emergency measure due to a bilateral free trade agreement, the USA, as the second largest supplier of frozen beef to Japan following Australia, is to be the major country affected by the tariff hike.

Japan has chose to impose emergency tariffs after frozen beef imports reached 89,253 tonnes in the April-to-June quarter, up 17.1 per cent from a year earlier. "This would harm our important bilateral trade relationship with Japan on agricultural products", USA secretary of agriculture Sonny Perdue said in a statement.




Japan has also increased its imports in anticipation that USA beef prices will soar following the resumption of US beef exports to China, the official said. The duty increases from 38.5% to 50% when imports exceed the safeguard volume.

"U.S. beef needs all the demand it can get", said John Nalivka, president of industry research firm Sterling Marketing. "Japan is the top export market for USA beef in both volume and value, and anything that restricts our sales to Japan will have a negative impact on America's ranching families and our Japanese consumers", Uden stated.

By volume, total USA beef sales to Japan for January-May came in at 123,290 tonnes, compared with 96,394 tonnes a year ago. The most recent quarter saw strong growth in imports from all of Japan's main beef suppliers.

The tariff hike is a "safeguard" mechanism to protect domestic farmers, Japan's ministry said.

Trade terms Japan negotiated with the 10 other remaining members of the TPP remain in force.

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