Japanese increased tariff on frozen beef has little effect so far

Wed, 11/08/2017 Groesbeck, Mexia News Staff Report

After Japan announced a steep rise in tariffs on U.S. frozen beef nearly three months ago, the Texas and Southwestern Cattle Raisers expressed concern that sales to Japan would be significantly impacted. The predicted drop in sales may happen as time passes, but so far the effect has not been apparent.

The tariff increase was announced July 28 and implemented automatically on Aug. 1 after sales of U.S. beef products spiked in Japan. The tariff will continue at the higher rate until at least March 2018.

Japan uses automatic tariff increases like this to protect its domestic producers, but the tariffs only apply to countries that do not have a trade agreement with Japan, such as the United States.

“Japan is the largest buyer of U.S. beef exports and the third largest destination for Texas beef,” said Richard Thorpe, president of the TSCRA said at the time the tariff increase was announced. “A 30 percent increase in the tariff rate will be detrimental to the U.S. cattle raisers, who rely on beef sales for their livelihoods, as well as the Japanese consumers who enjoy U.S. beef on their dinner tables. This is a prime example of why we need a free trade agreement like the Trans Pacific Partnership with Japan, and I hope this situation can be resolved swiftly.”

Jeremy Fuchs, a representative of TSCRA, said this week that the Association only has statistics through the end of August at this point, so he has not yet seen the effect he anticipates.

“We have not seen any significant effect on August trade numbers,” Fuchs said. “I think those effects are coming … it’s definitely going to have an effect, and it’s something we want people to know about as a potential adverse impact on the industry.”

Like Thorpe, Fuchs said a trade deal was needed.