In this file:

 

·         USDA and USTR Announce Continued Progress on Implementation of U.S.-China Phase One Agreement 

·         CPA: Is China Even Trying to Fulfill its Phase One Commitments?

·         China vows to push ahead with ‘phase one’ US trade deal amid renewed tensions

 

 

USDA and USTR Announce Continued Progress on Implementation of U.S.-China Phase One Agreement 

Source: USDA Office of Communications
May 21, 202

 

WASHINGTON, May 21, 2020 – The U.S. Department of Agriculture (USDA) and the Office of the U.S. Trade Representative (USTR) today announced additional progress in the implementation of the agriculture-related provisions of the U.S.-China Phase One Economic and Trade Agreement (The Agreement), which entered into force on February 14, 2020. Recent actions described below build upon the actions announced by USDA and USTR on February 25, March 10, and March 24. These are difficult times for both our countries. It is important that we each continue to work to make our agreement a success. Because of this continued progress due to the Agreement:

 

·     U.S. blueberries and California Hass avocados can now be exported to China. This new market access will provide California avocado growers and blueberry growers from around the United States with new opportunities to market their products to Chinese consumers in the coming years. In 2019, China imported a record volume of fresh fruits and vegetables exceeding $8.6 billion.  

 

·     U.S. barley for processing, along with the forage products Timothy hay, alfalfa hay pellets and cubes, and almond meal pellets and cubes can now be exported to China. In 2019, China imported $1.5 billion of barley used as feed and for malt beverage production, and a record $500 million of forage products. 

 

·     In recent weeks, China updated its lists of U.S. facilities eligible to export beef, pork, poultry, seafood, dairy, and infant formula products to China. China’s lists now include 499 beef, 457 pork, 470 poultry, 397 seafood, and 253 dairy and 9 infant formula facilities. As a result of these actions, more U.S. facilities are eligible to export U.S. food and agricultural products to China than ever before. USDA’s Food Safety and Inspection Service continues to update its export library, which provides additional guidance for U.S. meat and poultry meat exporters, including information related to the scope of products that may be exported to China, China’s labeling requirements, and other guidance.

 

·     China published on May 15 a new domestic standard for dairy permeate powder for human consumption that will allow imports of this product from the United States in the future. In 2019, China imported nearly $12 billion of dairy products from around the world. 

 

China continues to implement its tariff exclusion process in an attempt to facilitate imports of U.S. commodities. USDA continues to publish guidance for U.S. exporters seeking to participate in this process (USDA Global Agricultural Information Network). USTR is continuing to process and where appropriate grant exclusions of products from China. USDA also is implementing its obligations under the agreement.

 

United States Secretary of Agriculture Sonny Perdue said, “China is a market of tremendous potential for U.S. agriculture and these actions will help U.S. exporters expand their sales there. We look forward to continued cooperative work with China on implementation of Phase One commitments, and immediate increases in U.S. exports of all manner of agricultural products.”

 

United States Trade Representative Robert Lighthizer said, “China has worked with the United States to implement measures that will provide greater access for U.S. producers and exporters to China’s growing food and agricultural markets. Under President Trump’s leadership, we fully expect this agreement to be a success.”

 

 

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     usda.gov

 

 

Is China Even Trying to Fulfill its Phase One Commitments?

Beijing buys Brazilian soy and homegrown polysilicon rather than US

 

By Jeff Ferry, Coalition for a Prosperous America (CPA)

May 21, 2020

 

It is starting to look like China is unlikely to fulfill the terms of the so-called Phase One agreement on purchases of US goods and services.

 

That deal called for China to buy $200 billion over its 2017 purchase level in the two years 2020 and 2021. Those are solid commitments. It was never certain China would abide by its agreement. But recent data suggests China may not even be trying.

 

It is not too early in the US-China deal to determine whether Beijing is again finding ways to violate what it commits to. The administration should begin to consider its options if China is not serious about upping its purchases of US exports to anything like the Phase One targets. Government officials should begin planning on seizing the opportunity to decouple further from the Chinese economy.

 

The desperate shortage of medical supplies and drugs illustrates the danger of being dependent on China. And as we’ve argued elsewhere, the benefits of a Made in America 2030 program could be huge, including the creation of another trillion dollars of US output and up to three million good-paying jobs.

 

The Phase One agreement, signed by President Trump and Vice Premier Liu He in January, identified more than 500 product categories in four broad sectors, agriculture, energy, manufactured goods, and services, in which China would increase its purchases.

 

Many of the details of the deal are confidential but the targets for the broad categories are easily calculated. While the coronavirus pandemic is plausibly cited when China does not increase its purchases, that excuse does not hold water if it increases third country purchases or home grown production rather than US purchases.

 

For example, in agriculture, China agreed to buy about $36 billion worth of US agricultural exports to China this year, a 52 percent increase on last year. Soybean exports are the largest and most important part of our ag trade with China, because China is the world’s largest importer of soybeans and the US is the world’s second largest exporter, after Brazil.

 

Census data shows that in the first three months of this year, the US exported $1.03 billion worth of soybeans to China. That’s 39 percent down on the same period last year, when the corresponding figure was $1.7 billion. Weak global demand for US soybeans has weakened the price farmers get for their beans, down about $1.50 a bushel to around $8.50 today.

 

There are a number of plausible excuses for the poor export performance: first, coronavirus has obviously hit China’s demand for imports in the early part of this year, and the ability of the US to export in the March-April timeframe. Next, China is suffering from Asian swine flu, which has killed some 60 percent of their pig herd, denting demand for soybeans.

 

But the truth is that China is buying millions of tons of soybeans from Brazil instead of the US. In the first four months of this year, Brazil exported 906 million bushels (24.7 million tons) of soybeans to China, more than double the 11.4 million tons sent there by the US. Brazilian exports have benefited from a currency advantage. The coronavirus and related economic crisis have knocked 29 percent off the value of the real this year. This has widened the price advantage of Brazilian soybeans, but it is still only some $30 a ton (about 10%) See page 4 of this USDA report for details.

 

China could try harder to live up to the terms of the Phase One deal if it sincerely wanted the deal to succeed. That 10 percent price differential on soybeans is not a heavy lift, especially given China’s Phase One promises.

 

Further evidence of China’s lack of interest in fulfilling the deal comes from the polysilicon market. Polysilicon is the raw material that goes into the making of solar cells. The US is one of the world leaders in manufacturing polysilicon, but over 90 percent of the consumption of polysilicon and conversion into silicon wafers takes place in China. As part of the Phase One deal, China committed to increasing its purchases of US-made polysilicon by an undisclosed amount.

 

Census figures show that in the first three months of this year, Chinese purchases of US silicon fell by 37 percent, from $12.8 million to $8.1 million. This figure includes silicon used for traditional microchips in addition to solar, but industry sources confirm that they have seen no increase in Chinese buying this year. On the contrary, in March, Chinese polysilicon maker Tongwei announced it would increase its Chinese production of polysilicon by a massive 135,000 metric tons a year. This is more than six times the capacity of the polysilicon plant in the state of Washington that REC Silicon announced in February it planned to reopen to meet the opportunity to sell into the Chinese market presented by the Phase One deal.

 

The move by Tongwei suggests that with the ink hardly dry on the Phase One deal, China is quietly taking steps to reinforce its chokehold on the upstream segments of the solar cell market. Like most Chinese solar companies, Tongwei is linked to the Chinese government and its growth has benefited from massive multimillion dollar state subsidies.  Within the US solar industry, there is grave concern that far from following through on the Phase One commitments to buy more US product, the Chinese government is taking steps to strengthen its long-term hold on this strategic industry. That could have disastrous consequences for the new solar module factories in the US that are still ramping up production.

 

Census figures show that in aggregate, US exports to China in the first quarter were $22 billion, about 15 percent of the $142 billion expected this year under Phase One. According to Peterson Institute’s Phase One tracker, China is behind expected purchases in each of the major categories, agriculture, manufactured goods, energy, and other (services).

 

Of course, the coronavirus crisis has played a role in the slow start to the year. But if China were serious about fulfilling the terms of the agreement, we would expect to see more activity in these key sectors—and less purchasing with direct competitors like Brazil...

 

more, including charts

https://www.prosperousamerica.org/is_china_even_trying_to_fulfill_its_phase_one_commitments

 

 

China vows to push ahead with ‘phase one’ US trade deal amid renewed tensions

 

·         In a report on the work of the government delivered to the National People’s Congress (NPC) on Friday, Chinese Premier Li Keqiang vowed that Beijing will work with the U.S. to implement the “phase one” deal.

·         The partial accord was signed in January following protracted negotiations which held markets hostage for much of 2019.

·         Relations between Washington and Beijing continue to sour over blame for the coronavirus pandemic, financial market access disputes and new national security laws for Hong Kong.

 

Elliot Smith, CNBC 

May 22 2020

 

China has promised to continue working toward the implementation of its “phase one” trade deal with the U.S., as tensions flare up between the two economic powerhouses.

 

In a report on the work of the government delivered to the National People’s Congress (NPC) on Friday, Chinese Premier Li Keqiang vowed that Beijing will work toward the liberalization of global trade and investment.

 

“We will work with the United States to implement the phase one China-U.S. economic and trade agreement,” Li said.

 

“China will continue to boost economic and trade cooperation with other countries to deliver mutual benefits.”

 

Li also said China would “actively participate in reform of the WTO (World Trade Organization)” and work toward the signing of the Regional Comprehensive Economic Partnership, while advancing free trade negotiations with Japan and the Republic of Korea...

 

more, including links 

https://www.cnbc.com/2020/05/22/china-vows-to-push-ahead-with-phase-one-us-trade-deal.html