“Japan is our largest export market and our Japanese customers demand high-quality US beef,” said Tracy Brunner, NCBA president.
“However, due to the Australia-Japan Economic Partnership Agreement, US beef faces a tariff that is 11% higher than Australian beef, our leading competitor. That tax alone makes our beef less competitive and gives Australia’s beef producers a significant advantage that has allowed them to capture over $100 million in additional beef sales at the expense of US producers.”
When the Australia-Japan Economic Partnership Agreement was implemented towards the beginning of last year, the tariff rate on Australian beef exports to Japan dropped from 38.5% to 28.5%. As of 1 April 2016, that tariff was 27.5%. It will continue to fall until the tariff rate hits 19% in 2031.
Beef ‘disadvantage’ in Japan
“On 1 April, Australian beef producers got a tax break on beef exports to Japan and we paid for it in lost sales,” added Brunner. “We know Japanese consumers want US beef, but just like domestic consumers, they make their buying decision based on price and appearance.
“Until we level the playing field through TPP, US beef is going to be at an economic disadvantage in Japan. That is why we cannot afford to delay passage to TPP; every day costs our producers real money.”
The TPP’s implementation would result in the tariff rate on US beef immediately dropping from 38.5% to 27.5%. That rate would then continue to drop over the following 16 years until it rests at 9%.
“TPP is a great agreement for US beef producers and rural America,” concluded Brunner. “Trade supports US jobs, commodity prices, and the next generation of US beef producers. We are pleased to join with other food and agricultural groups in calling on Congress to pass TPP this Congressional session.”