Japan Issues Tariff On U.S. Beef

posted by Karla James - 

Japan said Friday it would impose a temporary 50% tariff on frozen beef from the U.S. and several other countries, a move that could inflame trade tensions, although Tokyo officials described it as a required response to a recent surge in imports.

The move, the first such step in 14 years involving beef, comes after President Donald Trump named Japan as one of the countries contributing to the U.S. trade deficit.

Japanese officials said the tariff increase was mandated under a framework that took effect following a 1994 global trade deal. The framework was to be scrapped under the Trans-Pacific Partnership, a proposed 12-nation trade deal that included the U.S. and Japan, but Mr. Trump pulled the U.S. out of the TPP before it went into effect.

The tariff increase to 50% from the regular 38.5% will take effect in August and hit frozen beef imports from countries that don’t have an economic partnership agreement with Japan, the Ministry of Finance said. That includes the U.S., the second-biggest foreign supplier of beef in Japan after Australia, as well as Canada and New Zealand.

The move doesn’t affect Australia, which has a free-trade deal with Japan, and doesn’t cover refrigerated or fresh beef.

The U.S. Meat Export Federation said Japan’s move would have negative implications for both U.S. beef producers and Japanese restaurant chains that rely on frozen American beef. The group “will work with its partners in Japan to mitigate the impact” of the move as much as possible, said Chief Executive Philip Seng.

U.S. government officials couldn’t be reached immediately for comment.

Under Japanese law, an additional tariff known as a safeguard is triggered when frozen-beef imports from all countries and frozen-beef imports from countries lacking free-trade deals with Japan-or “non-EPA countries”-both increase by more than 17% from the same period a year earlier. The import volumes are reviewed each quarter.

In the April-June quarter, Japan imported 89,253 tons of frozen beef, 37,823 tons of which came from non-EPA countries. Both surpassed the safeguard volume, the Ministry of Finance said.

Frozen beef is widely used at restaurants to make hamburger patties and bowls of beef over rice, a popular fast-food item in Japan. The safeguard duty affects around 12% of total beef supply in Japan, said Finance Ministry tariff official Koyu Izumi.

Recently, frozen beef imports from the U.S. have been on the rise, partly because Japanese importers likely sought to secure the meat before China resumes U.S. beef imports as a part of a trade deal, said Mr. Izumi.

In 2016, the U.S. exported $1.5 billion of beef to Japan, data from the U.S. Meat Export Federation showed.

In late 2003, Japan banned imports of U.S. beef after the discovery of a case of mad-cow disease. It resumed imports in late 2005, halted them again shortly afterward, then fully restarted them in mid-2006.

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