US dairy delegation to make Chinese trade mission amid tariff tension

23 Aug 2018 --- Leaders from America’s dairy industry travel this week to China to promote trade cooperation with official agencies in Beijing and Chinese dairy buyers in Xi'an. In Beijing, a delegation will discuss the flow of Sino/US dairy business amid months of trade tension that has led to tariffs on a long list of US exports, including dairy.

The moves amid a period in which the US dairy industry is struggling under the weight of tariff measures in Mexico and China, with the full industry implications only just starting to come to light, as we reported at the end of July.

In Xi'an, Tom Vilsack, President and CEO of the US Dairy Export Council (USDEC), will speak Saturday to hundreds of Chinese dairy leaders attending the China Dairy Industry Association meeting.

Vilsack said he is eager to reconnect with Chinese counterparts he has worked with for two years to develop a robust dairy trade infrastructure. In April, Vilsack kicked off a partnership with Jiangnan University that promotes dairy consumption and innovation. In February, Vilsack discussed trade relations with China’s Vice Minister of Commerce.

“China is a country where the impressive growth in the domestic dairy industry has been complemented by imports of many products that the local industry is not able to produce,” said Vilsack, a former US Agriculture Secretary.

“With an abundant supply of milk, US dairy exporters are uniquely equipped to meet growing Chinese demand for a wide range of nutritious, high-quality dairy products that are safely and sustainably produced. This is a partnership that will continue to benefit both countries for years to come.” 

But shipping US dairy products to China has become more challenging in recent months as the countries have raised tariffs against each other. 

Jaime Castaneda, USDEC’s Senior Vice President, says he and other members of the US delegation will continue to meet with government representatives from both nations to reiterate the damage being done by hindering dairy trade.

“China is one of our most important export markets and growth there has been unparalleled in recent years,” he explained. “Slowing that momentum is hurting farmers and manufacturers in the US and consumers in China. Chinese consumers have shown that they want US dairy goods, and we need to continue to expand sales to help combat falling prices at home.”

China is a large and growing market for US dairy, importing US$577 from US suppliers last year, a jump of 49 percent over 2016.

In response to new US tariffs announced on Chinese goods, China imposed tariffs as high as 25 percent on most US dairy products in July and has threatened to increase those dairy tariffs in the ongoing trade dispute.

USDEC has outlined a plan for immediately easing some of the tension on dairy as the two nations continue to work through their broader trade differences. The plan includes the speedy approval of US companies that have registered to export products to China, removing dairy from the retaliatory tariffs and approving technical regulations to facilitate the sale of US whey permeate as a food product in China.

From China, Vilsack and his team will travel to Seoul for meetings on Monday with South Korean dairy leaders.