U.S. Challenges China Over Corn, Wheat, and Rice Import Rules

23.02.2017

Three months after it challenged China’s farm subsidies, the U.S. filed a new case at the World Trade Organization, charging that China has suppressed imports of U.S. corn, wheat, and rice. The “opaque and unpredictable management” of the tariff-rate quota (TRQ) system denied U.S. farmers $3.5 billion in sales in 2015, according to USDA.

TRQs allow a specified amount of merchandise to enter a country at reduced tariff rates during a window of time. The U.S. trade representative’s (USTR) office says China violated its WTO commitments by leaving unclear the application criteria for TRQ imports, by failing to provide notice of the tonnage eligible for TRQ treatment, by changing TRQ volumes, and by not explaining how it runs the program.

As part of entering WTO, China agreed to permit imports of 7.2 million tonnes of corn, 9.6 million tonnes of wheat, and 5.3 million tonnes of wheat at lower tariff rates. “Despite lower global prices that favor the importation of grains into China, the TRQs for each commodity persistently do not fill,” says the USTR.

WTO cases typically take 18 to 24 months to complete, including an appeal of a dispute panel decision. In the WTO case files in mid-September, the U.S. said China provided nearly $100 billion in excess support for corn, wheat, and rice in 2015 by setting domestic grain prices above world market prices. China has huge stockpiles of corn, wheat, and cotton.


agriculture

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