Starting August 1, 2017, Japan has triggered a safeguard to increase the tariff on its frozen beef imports from countries that it does not have a free trade agreement with. Increasing the tariff on frozen beef imports from 38.5% to 50% will impact Canada and the United States and not Australia, Chile and Mexico who have free trade deals with Japan. Australia will continue to enjoy a 25% tariff that was negotiated in its bilateral trade deal with Japan. Australia is already over 50% of Japan’s frozen beef imports before the tariff hike.
According to John Masswohl, Canadian Cattlemen’s Association, “if TPP was in place this safeguard trigger would not be an issue and Canada’s tariff cost of getting frozen beef into Japan would be similar to Australia”
It is clear that not having the Trans Pacific Partnership in place is hurting Canadian producers and Japan blowing through the import safeguard is not protecting domestic Japanese producers as Australia will likely continue exporting at much lower tariffs than Canada and the United States.
While Canada wonders what could of been with TPP, the United States is not recognizing that they ultimately chose this outcome by abandoning TPP back in January.
“This [tariff increase] would harm our important bilateral trade relationship with Japan on agricultural products. It would also negatively affect Japanese consumers by raising prices and limiting their access to high-quality U.S. frozen beef. I have asked representatives of the Japanese government directly and clearly to make every effort to address these strong concerns, and the harm that could result to both American producers and Japanese consumers,”
According to Drovers the increased tariff will be in place until the end of the first first quarter of 2018.
This frozen beef tariff increase is definitely a woulda coulda shoulda moment of reflection on the Trans Pacific Partnership for beef producers in Canada and the United States.