White House Will Push China to Make Up for $16B Trade Deficit in Phase One, Vilsack Tells American Farm Bureau

The American Farm Bureau Federation (AFBF) Convention in underway in Atlanta this week, and as Phase One agreement with China is now expired, USDA Secretary Tom Vilsack spoke to members in-person, assuring farmers and ranchers the White House will push China to make up for the $16 billion shortfall in trade.

The in-person event is drawing farmer leaders from across the country with a focus on everything from H-2A workers, impacts from the drought, supply chain chaos, as well as policy changes like the Waters of the U.S. (WOTUS) rule.

Convention goers on Monday also heard from both President  Biden and USDA Agriculture Secretary Tom Vilsack. Biden's remarks were in video message, but Vilsack was in-person this week. During Vilsack's talk, he went through the list of programs the Biden Administration has put in place in the past year that impacts the farming community. He also talked about the importance of building trust among farmers when it comes to trade.

"And I think it starts with China. And we all know and appreciate the fact that we have a Phase One trade agreement with China," Vilsack told AFBF members. "And during that period of time, we saw sales to China increase over what they were during the the trade war. But here's the deal with Chinese friends, they're about $16 billion light over what they committed to purchase. And that's why Ambassador Tai, our U.S. Trade Representative, continues to converse with China about the necessity of living up totally and completely to the Phase One trade agreement, making up that $16 billion deficit over the course of the next several years."

Vilsasck says as the Biden administration works to hold China accountable to their trade commitments, it's more than just boosting exports that will remain a priority for the White House.

"And also working on those sanitary and phytosanitary barriers that still exist in the Chinese relationship that they agreed to remove other tracks dopamine in pork or whether it's hormones and beef, or whether it's ethanol, tariffs or the ability to to purchase more DDGs," Vilsack added. "All of these steps that China can take and needs to take to live up to this phase one trade agreement are important and we're going to continue to press China on the need for complete enforcement and complete implementation."

While the minimum purchase commitments only covered two years from 2020 to 2021 within the Phase One trade agreement, USTR's office says the remainder of the original Phase One deal is still intact and has not expired. USTR's office also tells AgWeb virtual conversations with People's Republic of China (PRC) are ongoing, but there are currently no plans for USTR officials to travel to China for talks.

After fallout from the Trade War, China ramped up purchases of sorghum, corn and other ag goods during the 2020 to 2021 time period. However, most economists and analysts say China bought out of necessity, not to live up to its trade promises and commitments within the Phase One agreement.