The U.S. Department of Agriculture expects China to begin fulfilling portions of its agricultural purchase commitments by the end of this summer, Secretary Sonny Perdue said during a March 4 House hearing. Although the coronavirus outbreak has delayed the purchase commitments under the phase one trade deal (see 2001150073) and thrown global agricultural trade into uncertainty, Perdue said the USDA has received “signals” that China intends to fully comply with the purchase agreements (see 2002250055). “We believe that China is a shrewd customer. They’re going to buy where the best deal is,” Perdue told the House Agriculture Committee. “We think they’ll come into this market in late spring and summer and fulfill the commitments.”
Exports to China
Increases in Indian tariffs and a push by India to increase domestic manufacturing (see 2001270016) are hurting the toy industry, The Toy Association said March 3. The trade group said India recently issued its second duty increase on toys in two years, raising tariffs from 22% to 66% in February. The association said it is working with trade association partners in India, the European Union and elsewhere, and coordinating with the Trump administration to advocate against the tariff increases. But the effort is proving difficult due to India’s “Made in India” push driven by “a strained relationship between China and India and budgetary concerns,” the association said.
The government of Canada issued the following trade-related notices as of Mar. 4 (note that some may also be given separate headlines):
Export Compliance Daily is providing readers with some of the top stories for Feb. 24-28 in case you missed them.
Applicants for the most recent Chinese tariff exclusion process should expect to spend less time justifying their requests and instead benefit from a less costly and lengthy application process, according to a Feb. 28 report from PricewaterhouseCoopers. China’s announcement last month to accept exemption applications for retaliatory tariffs on nearly 700 U.S. products (see 2002180039), which officially began March 2, reduces the “cost and difficulty” in applying for exclusions compared with previous procedures, the report said. Applicants only need to submit “basic information,” such as Harmonized System codes and planned purchase amounts. Applicants should expect to spend less time justifying their requests with no need to explain the impact of Chinese retaliatory tariffs on their business or whether there is “alternative sourcing in the market, the major impacts of additional tariffs on industries and society, etc.,” PwC said. The report details the requirements applicants must meet, the scope of the products affected and more.
The U.S. should lobby for increased export controls and more stringent sanctions regimes relating to weapons proliferation at the upcoming Non-Proliferation Treaty review conference, arms control experts said during a March 3 House hearing. While it may be difficult for all treaty members to sign off on a broad consensus document relating to non-proliferation, the U.S. should use the spring conference in New York to seek common ground on controls of items used to produce dangerous weapons.
The government of Canada issued the following trade-related notices as of Feb. 28 (note that some may also be given separate headlines):
A Congressional Research Service report on agricultural trade issues in the U.S. noted that even though ag exports to China dropped 53% from 2017 to 2018 due to retaliatory tariffs, overall ag exports only fell 2% in 2019, and some of that was due to lower commodity prices rather than lower volume. The report covered agricultural issues in the bilateral trade negotiations with Japan, Kenya, India, the European Union and United Kingdom, and noted that ag trade between the U.S. and the EU is less than 1% of all trade between the two regions, though the EU is the fifth-largest market for U.S. commodity and food exports. The top ag exports to the EU were corn, soybeans, tree nuts, distilled spirits and fish. Top imports from the EU were wine, distilled spirits, beer, bottled water and olive oil.
At least three Mexican ports are requiring 48 hours' notice before ships arrive from China, in an effort to prevent the spread of the coronavirus through crew members, according to a Feb. 27 report from Mexico Today. The “detection protocol” is being carried out at the Manzanillo, Lázaro Cárdenas and Ensenada ports along the Pacific coast, which all have “direct trade links” to China, the report said. The Manzanillo port is Mexico's largest port by volume, the report said, moving more than 3 million containers per year. Manufacturers in northwestern Mexico have reported interruptions in production lines for a variety of goods -- including in the electric, auto, aerospace and medical equipment industries -- due to Chinese supply chain delays, the report said.
Europe completed the first transactions under INSTEX, the European payment system designed to allow countries to trade with Iran despite U.S. sanctions, according to a Feb. 26 news release from the Joint Commission of the Joint Comprehensive Plan of Action. During a recent meeting, the commission, which includes representatives from China, France, Germany, Russia, the United Kingdom and Iran, also said it added four more European countries as “new shareholders” in INSTEX and expects more to join. “Participants welcomed positive developments in the processing of first transactions by INSTEX,” the news release said. The news release did not name the new shareholders.