Kansas Ag Connection - China Announces 179 Percent Tariff on U.S. Sorghum Imports

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China Announces 179 Percent Tariff on U.S. Sorghum Imports
Kansas Ag Connection - 04/19/2018

China ordered importers of U.S. sorghum to pay deposits for possible higher tariffs in an anti-dumping investigation, adding to growing trade conflict with Washington.

A preliminary ruling by the Commerce Ministry said Tuesday that U.S. sorghum was being sold at improperly low prices, hurting Chinese farmers. It said importers must post bonds of 178.6 percent of the value of their goods to cover possible anti-dumping duties while the probe is completed.

Beijing launched the sorghum investigation on Feb. 4 in what some business people saw as a warning shot as President Donald Trump hiked tariffs on Chinese-made washing machines and solar modules.

Since then, Trump has threatened to raise duties on up to $150 billion of Chinese goods in a dispute over technology policy. Beijing has responded with its own list of U.S. goods for possible retaliation.

The measures on sorghum, a grain used in animal feed and for making the fiery traditional Chinese liquor baijiu, target farm areas that voted for Trump in 2016, foreign analysts report. China is one of the biggest foreign markets for U.S. sorghum growers.

The United Sorghum Checkoff Program reports the grain is traditionally grown throughout the Sorghum Belt, which runs from South Dakota to Southern Texas, primarily on dryland acres. Acreage increases are seen in non-traditional areas like the Delta and Southeast regions. In 2017, sorghum was planted on 5.6 million acres and 364 million bushels were harvested. The top five sorghum-producing states in 2017 were:

Kansas -- 2.6 million acres

Texas -- 1.65 million acres

Colorado-- 410,000 acres

Oklahoma -- 315,000 acre

South Dakota-- 270,000 acres

Chinese investigators concluded dumping of U.S. sorghum "substantially damaged'' Chinese competitors, the Commerce Ministry said. It said prices of U.S. sorghum fell 13 percent from 2013 to 2017, while shipments increased 14-fold.

U.S. Secretary of Agriculture Sonny Perdue Wednesday said, "The international grain market is about the freest market there is, and it is ludicrous to even mention 'dumping,' because China can buy product from anywhere they choose. This is clearly a political decision by the Chinese and we reject their premise. Our sorghum producers are the most competitive in the world and we do not believe there is any basis in fact for these actions. As we explore options, we are in communication with the American sorghum industry and stand united with them. The fact remains that China has engaged in unfair trade practices over decades and President Trump is correct in holding them accountable. We remain committed to protecting American agricultural producers in the face of retaliatory measures by the Chinese."

The United Sorghum Checkoff Program board includes Kansans Craig Poore, Alton; Clayton Short, Assaria; Boyd Funk, Garden City; Martin Kerschen, Garden Plain; and Shayne Suppes, Scott City.

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