ASA Pleased at China’s Entry to WTO, Raises Concerns About New Biotech Import Regulations

Sep 20, 2001

The American Soybean Association (ASA) welcomes the news that World Trade Organization (WTO) members endorsed China’s entry into the WTO this week. ASA has long supported China’s participation into the WTO because it will foster even stronger ties with China, which recently became the largest single market for U.S. soybeans. China will formally join the WTO at the Ministerial meeting in Qatar in November.

The final accession negotiations included further concessions by China on access for U.S. soybean oil imports. The initial in-quota quantity for soyoil was increased from 2.0 to 2.1 million tons, rising to 3.6 million tons over five years. More importantly, the U.S. was able to negotiate parity between soybean oil and rapeseed and palm oil with regard to quota growth, over-quota duties, and in-quota duties. These terms ensure that soyoil will have equal access with competitor oils to the Chinese market.

“ASA is pleased that China’s accession negotiations have been completed,” said ASA President Bart Ruth, a soybean grower from Rising City, Nebraska. “Also, negotiation of equal access for soybean oil and other major imported oils was a key ASA objective, and we applaud the Administration negotiators who achieved it.”

Ruth went on to say, “Our enthusiasm for China’s entry into the WTO on favorable terms for the U.S. soybean industry is tempered by recent developments in which China is preparing to introduce regulations governing imports of biotech soybeans approved in the U.S. and other major foreign markets. These regulations have not been made available in advance for review and comment by the U.S. Government or our industry.”

“Moreover,” Ruth stated, “it is unclear whether there will be a ‘grace period’ before the new regulations are made effective. The resulting confusion has brought U.S. soybean exports to China to a standstill on the eve of harvest of another large soybean crop in this country.” Ruth concluded, “Any further delay in shipments could sharply reduce U.S. soybean exports to China in 2001, estimated at 5.7 million tons. Failure to resolve this issue immediately would set a very bad precedent as China prepares to join the WTO later this year.”

In recent years, China has expanded its infrastructure that will accommodate imports of U.S. soybeans, soybean meal and oil. Its population of more than 1.2 billion is becoming increasingly urban, and the demand is rising for a diet higher in vegetable oil and protein.