The U.S. is launching a challenge at the World Trade Organization (WTO) on China's domestic price supports for the production of rice, wheat and corn, US officials announced Tuesday.
China's “market price support” for rice, wheat and corn is estimated to nearly be $100 billion above the WTO limits and provides an artificial incentive for Chinese farmers to increase production of those crops.
“These programs distort Chinese prices, undercut American farmers, and clearly break the limits China committed to when they joined the WTO,” U.S. Trade Representative Michael Froman said in a statement. “We will not stand by when our trading partners fail to follow the rules like everyone else.”
USTR analysis showed China's domestic price supports for wheat, Indica rice, Japonica rice and corn have exceeded the 8.5 percent “de minimis” level allowed under the WTO commitment for every year since 2012.
While U.S. agricultural exports to China are at $20 billion, USDA Secretary Tom Vilsack said at a briefing announcing the action that they would be even higher if not for the Chinese domestic farm supports.
Several lawmakers joined Vilsack and Froman in announcing the action, with Senate Ag Committee Chairman Pat Roberts, R-Kan., stating, “If we are to remain competitive in the global marketplace, it is critical that our partners adhere to and abide by the same rules that we have all agreed to.”
US growers have “invested their time and resources in the difficult task of understanding and documenting Chinese market price supports for wheat, corn, and rice,” Roberts said. “It is our government’s responsibility to listen to the concerns of the US agriculture industry and begin the process of holding China accountable to its commitments in the World Trade Organization.”
Pixabay photo: CC0 Public Domain