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September 26, 2011

U.S. Files WTO dispute on China's Duties on Imported Chicken

For more information on Newsline, contact: Kari Barbic, Media Specialist, American Farm Bureau Federation, karib@fb.org.

On Tuesday, the United States filed a dispute claim through the World Trade Organization against China alleging that its duties on imports of American chicken products breach China's WTO obligations. Dave Salmonsen, AFBF senior director of congressional relations, explains the dispute and what will happen next. Miranda McDaniel reports.
McDaniel:The United States is claiming that China's duties against U.S. chicken imports appear inconsistent with WTO rules.The U.S. filed a dispute settlement claim against China last week. American Farm Bureau's Dave Salmonsen says since China enforced these duties in August and September of 2010, American poultry farmers have felt the backlash.
Salmonsen:It’s had an impact. The duties range from 50 percent to100 percent and since that time a market for U.S. poultry that was approaching a billion dollars a year, is now down to about 100 million dollars a year. The U.S. is saying that the duties weren’t properly calculated, the methodology behind them was flawed and they violate several portions of the WTO agreement.China believes that they were being dumped. That our exports were hurting their domestic industry, so they added these duties in a sense to slow down imports, which of course it has done.
McDaniel:Salmonsen says this is not the only trade issue America is having with China.
Salmonsen:The fact, when you trade a lot together issues come up, frictions come up, each side thinks the other side maybe isn’t playing completely by the rules, and so they bring these cases to try and get this clarified. In this case, of course, it’s a fairly straight forward issue of we don’t like the fact these duties are hurting our exports to China. Where overall, there’s several other issue areas where we’re having discussions, may not rise to the level of bringing a WTO case, but there’s continued discussions going on between the U.S. and China over beef exports, still lingering issues from eight years ago when they stopped our beef imports because of the BSE issue. We’re exporting a lot of pork to China right now, but we could do more, but China also has some limitations on our pork exports We also have issues related to our export of some grains.
McDaniel:He says despite this, and other claims, China is still an important market for the U.S.
Salmonsen:In a sense, the case highlights what has been a growing relationship with U.S. agricultural exports and China. China is now our number one ag export destination and almost 20 billion dollars a year has been growing rapidly over the last several years. While the case is important in itself, it’s also a piece of a much bigger agricultural picture between the U.S. and China.
McDaniel:Miranda McDaniel, Washington.
McDaniel:We have two extra actualities with AFBF Senior Director of Congressional Relations Dave Salmonsen. In the first extra actuality he explains the drawn out resolution process. The cut runs 35 seconds, in 3-2-1.
Salmonsen:The WTO has an awful lot of procedure in cases. Starts off with a 60 day consultation, where they think the parties can work it out. Sometimes that happens, I suppose, but more often, if you’ve gotten to the point of filing a case you’re gunna proceed to the case. Then you have another length of time to form a dispute panel basically get the judges, present your case, review all that. At the end of the day it takes about a year before the first decision is reached and then, it can go on even longer if an appeal is made. So at the minimum 12 months, maximum could be 18 months to two years before this particular issue would be resolved.
McDaniel:In the second extra actuality he talks about AFBF's stance on the dispute. The cut runs 13 seconds, in 3-2-1.
Salmonsen:Well we’re want to see this trade restored. So in a sense, if this is the mechanism that has to be done to test out with the international system whether these duties were properly imposed than that’s the way to go.
McDaniel:Newsline is updated Mondays and Thursdays by 5pm eastern time. Thank you for listening.

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