Chinese officials have officially accepted an August finding by the World Trade Organization that China improperly imposed anti-dumping and counterveiling duties on U.S. poultry.
In 2009, China was the largest foreign market for U.S. broiler meat, buying 613,000 metric tons of chicken. In September of that year, Chinese officials determined the U.S. poultry industry was selling its product at prices below U.S. market prices, an illegal act known as dumping.
China imposed steep duties, and U.S. broiler meat sales to the country plunged 90 percent.
The U.S. industry protested, saying China did not accurately figure the costs or prices by assigning the same price per pound for all parts of a chicken — whether breast meat, leg quarters or chicken paws.
In siding with the U.S., the WTO panel ruled that such average-cost accounting isn’t an acceptable methodology to determining whether a particular part of chicken was dumped into an export market.
China didn’t challenge the finding, but didn’t indicate when it would drop the import tariffs and duties, either.
“The most important thing for both sides is to put this unfortunate situation behind us as quickly as possible,” said Jim Sumner, president of the USA Poultry & Egg Export Council. “We’re also hopeful that China will remove anti-dumping duties on U.S. chicken imports quickly.”
Sumner met with Chinese poultry industry organizations several times to emphasize the positive relationship the U.S. and Chinese industries have developed over the years, and to solicit support for continued joint industry-to-industry activities, such as an international poultry symposium scheduled for November in China.
After China imposed the duties, Mexico became the top export market for U.S. poultry. A Mexican government agency last year made an almost identical finding that U.S. chicken was being dumped. U.S. officials in turn made an almost identical argument that Mexico didn’t differentiate between different parts of the chicken.
The U.S. industry, through USAPEEC, has filed a challenge under the North American Free Trade Agreement. A hearing had been expected in September, but NAFTA has yet to seat a panel of experts to hear the case. Although one Mexican agency voted to impose steep duties on U.S. poultry, another Mexican agency set aside the duties, saying food inflation was already too high.
The industry hopes Mexico will remove the decision from its books because it conflicts with WTO rules, Sumner said in a recent interview.