China's Antidumping Tariffs

In recent years, the United States has taken the lion's share of the Chinese broiler meat import market. Under the threat of rising poultry imports from the United States, Chinese producers reportedly asked for an investigation into chicken prices, accusing U.S. poultry firms of dumping. China began an investigation of U.S. chicken imports in September 2009, two weeks after the Obama administration announced tariffs of up to 35 percent on tire imports from China. This apparent counter measure is an indication of a new round of trade conflicts, possibly leading to a deepening trade rift. This investigation led to antidumping duties on U.S. chicken imports. A UGA study by agricultural and applied economists is designed to evaluate U.S.-China poultry bilateral trade relations under the new tariff using an excess-supply-excess-demand model. In the U.S.-China poultry dispute, the Chinese consumers are predicted to bear about 40 percent of the tariff on U.S. chicken wings and almost 80 percent on U.S. chicken legs. Attempts to estimate the needed elasticities for chicken feet exports were unsuccessful but with the lack of alternative markets for feet, and the joint nature of production for chicken parts, the tariff on feet will likely be almost completely reflected in lower U.S. producer prices while consumer prices in China are little affected.