Texas cattle ranchers uneasy over proposed Chinese tariffs on beef

A brewing trade war between the United States and China is making Texas cattle ranchers nervous about potential tariffs on their beef exports.

By Sydney Greene April 5, 2018

 

Image removed.
Photo: Kay Ledbetter

Longtime cattle rancher Jason Peeler gets uneasy when he hears about a looming trade war between the United States and China, and he says he's not the only one.

A brewing trade war between the United States and China is making Texas cattle ranchers nervous about potential tariffs on their beef exports.

Texas' beef industry has just started re-establishing a relationship with China; a 14-year ban on U.S. beef exports to the country was lifted just last year. Texas is only exporting a small amount of beef to the country, but the industry is still feeling the pressure, especially given a related tariff threat on pork.

“There is a relationship between pork prices and beef prices,” said David Anderson, an economist at Texas A&M University. “Cheaper pork means pork is a little more competitive for U.S. consumers' dollar.” 

It also means the price of beef goes down, leading to less profit for cattle ranchers, Anderson said.

The back-and-forth between the two economic powerhouses started last month, when the Trump administration moved to tax steel and aluminum from China and other countries. China struck back earlier this week, threatening to put a 25 percent tax hike on imports from pork to pecans.

On Tuesday, the Trump administration announced $50 billion worth of proposed tariffs on Chinese valued U.S. exports such as aircraft parts and flatscreen televisions. China answered by adding beef, among other items, to their list.

The potential tax on beef could impact Texan ranchers, but Chinese consumers can get hurt even more, said Pete Bonds, a rancher in Saginaw.

“It will make the beef more expensive to the Chinese consumers — they’re actually hurting the Chinese,” said Bonds. “I’m more sad for the Chinese consumer.”

 

This item was originally published in The Texas Tribune on April 5, 2018
https://www.texastribune.org/2018/04/05/texas-cattle-ranchers-uneasy-over-proposed-chinese-tariffs-beef/