The government of Japan has raised tariffs for U.S. beef from 38.5 percent to 50 percent which will last until March 31, 2018. U.S. Secretary of Agriculture Sonny Purdue has expressed concerns with the new tariffs and the U.S. trade relationship with Japan. Experts from Utah are concerned about trade relationships with Japan, but aren’t concerned for local beef producers.
According to the United States Department of Agriculture, U.S. exports of beef and beef products to Japan totaled $1.5 billion last year, making it the United States’ top market. Derek Miller, the president and CEO of World Trade Center Utah said Japan is on Utah’s top ten export destinations.
“In 2016 Utah exported almost $3.5 million of frozen beef to Japan,” Miller said. “So I expect next year that number to be lower. I expect that we’ll export less beef to Japan. Overall it won’t hurt our ranchers, because of the way the system works of course.”
Miller said the ranchers here in Utah are not exporting directly. Beef producers don’t have much say in the price in which their cattle are sold to other countries. The cattle are raised, sold and eventually end up at processing plants, and they take care of price negotiations for exports.
“I have no doubt that our Utah ranchers working through their processing plants will find other markets,” Miller said. “It will really end up hurting the Japanese consumer and the Japan economy.”
Miller said Japan will only have short term gain, but the U.S. and other countries that export beef to Japan will find other markets. With less beef in Japan the prices will go up there because the demand from consumers will still be the same.
Beef may not be the only thing the U.S. has to worry about in the future. Miller said there is a potential long term risk with more trade barriers.
“You know, retaliatory actions by the U.S. If it starts to get that back and forth and leads to trade wars and then you’ve got higher tariffs and not just on beef exports,” Miller said. “That’s what the real risk is in this scenario.”
