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IDFA Keeping Dairy Top of Mind in US Trade Talks with China

Mar 19, 2019

Earlier this month, President Donald Trump delayed indefinitely the March 1 deadline for imposing additional tariffs on Chinese imports to allow current trade negotiations between the two countries to make progress. IDFA continues to urge the administration to include provisions in the final agreement that will provide the U.S. dairy industry with meaningful access to the $10 billion Chinese dairy import market.

IDFA is also meeting with U.S. senators, urging them to ask President Trump to ensure that dairy is top of mind during the U.S. discussions with Chinese leaders. 

Tariffs and Timing

Last summer, the United States imposed tariffs on more than $250 billion worth of Chinese goods under Section 301 of the U.S. Trade Act of 1974  as a way to push back against China’s intellectual property policies and practices. China issued retaliatory tariffs that included essentially all U.S. dairy products. On Dec. 1, the United States and China agreed to freeze the tariffs temporarily at current levels for 90 days, rather than continue with expected escalations, to allow trade negotiations to continue.

China was the third largest export market for the U.S. dairy industry in 2017. U.S. dairy exports totaled $538 million compared to only $154 million 10 years prior. However, the retaliatory tariffs are derailing those gains and costing the U.S. dairy industry millions in sales, market share and jobs. In 2018, the United States lost 40 percent of its cheese and whey exports to China compared to 2017. 

The European Union currently holds 47 percent of the $10 billion market in China for dairy imports, and New Zealand is a close second with 38 percent of the market, thanks in part to trade agreements that China has negotiated with the two trading partners. The United States has less than 5 percent of this huge market, and China’s retaliatory tariffs are allowing our competitors in the EU and New Zealand to gain further inroads.

Advocacy on Many Fronts

In addition to meeting with members of Congress, IDFA submitted comments to the House Committee on Ways and Means and sent a joint letter with the National Milk Producers Federation and the U.S. Dairy Export Council to President Trump in support of a deal that will make it possible for the U.S. dairy industry to sell products competitively to China.  

For more information, contact Beth Hughes, IDFA senior director of international affairs, at bhughes@idfa.org.

 
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