USTR working on Japan beef access

Consultations ongoing to adjust safeguard trigger levels of Japan’s beef imports.

Jacqui Fatka, Policy editor

December 27, 2021

3 Min Read
Japan beef counter iStock71268958.jpg
CUT THE TARIFFS: New agreement eliminates U.S. beef reaching safeguard triggers in Japanese markets.Getty Images

United States Trade Representative Katherine Tai and Deputy United States Trade Representative Sarah Bianchi held a virtual meeting December 21 with Japan’s Minister of Foreign Affairs Hayashi Yoshimasa to discuss the status of consultations to adjust the applicable safeguard trigger levels of Japan’s beef safeguard to higher levels for U.S. beef exports to Japan.

This past year, Japan’s imports of U.S. beef exceeded the safeguard threshold of 242,000 mt on March 17, approaching the end of the Japanese fiscal year (March 31). This triggered a higher tariff rate of 38.5% (up from 25.8%) on U.S. beef muscle cuts, which was in effect for 30 days – from March 18 through April 16. After this 30-day period passed, the tariff rate for U.S. beef declined to 25%, as provided in the Japan-U.S. Trade Agreement to offer a level playing field for what other nations receive under the Comprehensive and Progressive Agreement for Trans-Pacific.

“But for our competitors that are members of CPTPP, that 25% tariff rate went into effect on April 1,” explains U.S. Meat Export Federation Economist Erin Borror.

The next round of beef tariff rate reductions under both CPTPP and the Japan-U.S. agreement is set for April 1, 2022. “But unless the safeguard threshold for U.S. beef is adjusted, we expect a similar scenario in March in which U.S. beef temporarily faces a significantly higher tariff rate (30% this time) and the next tariff rate reduction for U.S. beef (down to 24%) is delayed,” Borror adds.

In fact, USMEF projects that the safeguard will be triggered every year unless adjustments are made to the threshold. “This distorts the market and puts U.S. beef at a disadvantage, not only due to product clearing under the higher tariff rate, but also because some importers will delay purchases to avoid the period in which the higher rate is in effect,” Borror explains. “The timing of the tariff rate increase is also unfortunate, as it impacts purchases leading up to Japan's Golden Week holidays – a period of high beef demand.”

Japanese importers are already increasing beef imports from CPTPP trading partners such as Canada, New Zealand and Mexico, in part because there is essentially zero risk of triggering the beef safeguard included in CPTPP. The same is true for European beef, which is at no risk of triggering the safeguard in the Japan-EU FTA, Borror explains.

With tight global beef supplies, Japanese buyers are competing with those around the world – especially South Korea and China – for high-quality beef, and Japan's 25% tariff rate is still the highest among major importers. “The added threat of a higher safeguard tariff is a further burden for importers and for Japanese consumers,” she says.

At current threshold levels, the safeguard diminishes one of the main goals and attributes of the Japan-U.S. Trade Agreement, which was to put U.S. beef and other U.S. agricultural products on a level playing field with our competitors in Japan.

“USMEF is encouraged by the consultations with Japan and we look forward to further updates from USTR,” Borror concludes.

About the Author(s)

Jacqui Fatka

Policy editor, Farm Futures

Jacqui Fatka grew up on a diversified livestock and grain farm in southwest Iowa and graduated from Iowa State University with a bachelor’s degree in journalism and mass communications, with a minor in agriculture education, in 2003. She’s been writing for agricultural audiences ever since. In college, she interned with Wallaces Farmer and cultivated her love of ag policy during an internship with the Iowa Pork Producers Association, working in Sen. Chuck Grassley’s Capitol Hill press office. In 2003, she started full time for Farm Progress companies’ state and regional publications as the e-content editor, and became Farm Futures’ policy editor in 2004. A few years later, she began covering grain and biofuels markets for the weekly newspaper Feedstuffs. As the current policy editor for Farm Progress, she covers the ongoing developments in ag policy, trade, regulations and court rulings. Fatka also serves as the interim executive secretary-treasurer for the North American Agricultural Journalists. She lives on a small acreage in central Ohio with her husband and three children.

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