CHICAGO – China and the United States are kicking up a trade war over chicken in which Beijing effectively has given the boot to millions of dollars worth of U.S. chicken, about half of which is chicken feet.
This action comes as Congress begins deliberating the 2010 federal budget for agriculture, which could extend a U.S. ban on imports of Chinese chicken products sparked by food safety concerns.
In a note to clients last week, Stephens Inc analyst Farha Aslam said earnings for chicken producers Tyson Foods Inc or Sanderson Farms Inc would be impacted if the ban lasted past September.
CHINA MAY BE RETALIATING
“They want to get rid of the DeLauro Amendment. So this might be a shot over the bow,” Paul Aho, an economist with the consulting firm Poultry Perspective, said of the Chinese efforts.
The measure, championed by Representative Rosa DeLauro, prevents the U.S. Agriculture Department from allowing imports of poultry from China.
DeLauro is the Democratic head of an influential House of Representatives appropriations subcommittee that oversees the U.S. Agriculture Department and Food and Drug Administration.
Her committee has effectively blocked imports of Chinese poultry products because of food safety concerns.
An annual spending bill, which the House of Representatives is expected to debate on Wednesday, could extend that ban through fiscal 2010, which starts October 1.
The Senate has not yet deliberated its version of the USDA appropriations bill.
In April, China launched a dispute with the World Trade Organization against the United States over the Congressional measure.
The poultry issue is the latest of several trade skirmishes between the two countries covering a range of products.
Senior officials from the U.S. Trade Representative’s office will travel to China next week to meet with officials about bilateral trade issues.