Opinion: Joe Biden-Xi Jinping virtual summit was important for Iowa
The Chinese targeted the threonine and lysine markets in the United States because their own domestic pig market was devastated by swine flu.
This week, President Joe Biden and Chinese President Xi Jinping met at a virtual summit. They discussed working together to reduce trade tensions, and specifically to curtail Chinese government sponsorship of certain industries, which gives those businesses an unfair competitive advantage on global markets.
This is particularly important for Iowa, because Iowa is a farm state, and the Chinese government has knowingly supported many of their agricultural industries at the expense of American farmers and producers.
While no breakthroughs have been announced, this executive meeting is part of a critical conversation that we must have with China.
More:Biden and China's Xi met Monday in a virtual summit. Here's where the relationship stands.
One issue that I will raise with the Biden administration is the Chinese government’s continued subsides of its amino acid industries. Specifically, a recent study found that the Chinese are selling threonine and lysine — types of amino acids — in the U.S. and jeopardizing those domestic industries. The study concluded that Chinese imports of these amino acids “poses a threat to the entire domestic industry, which produced over $3 billion of output last year and supports nearly 30,000 jobs.”
This is important to Iowa, because a vast majority of these critical amino acids are produced in the Hawkeye State, utilizing millions of bushels of Iowa corn. For pigs and chickens, threonine and lysine are critical components in animal feed, and offer a variety of benefits for the environment and the overall wellbeing of these farm animals.
We know that the Chinese targeted the threonine and lysine markets in the United States because their own domestic pig market was devastated by swine flu. In desperation, the Chinese government had to organize a massive culling of millions of pigs, and therefore threonine and lysine became commodities in surplus.
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Because the protectionist Chinese government subsidizes the production of these amino acids, they can sell them for less than threonine and lysine produced in Iowa. Should these cheap, government subsidized Chinese amino acids eliminate domestic production, the Chinese can then raise their prices, or make demands on both U.S. businesses or our government in exchange for not raising prices.
Chinese control of the global threonine and lysine industries could also mean grave consequences for Iowa pig and chicken producers. You can see why eliminating Iowa’s threonine and lysine industries would be so appealing to China, and why what they are doing constitutes such a threat to our free market systems.
In addition to these bilateral negotiations between the U.S. and China, it's been reported that Biden is considering beefing up tariffs on Chinese products from subsidized industries through Section 301 investigations by U.S. Trade Representative Katherine Tai. It is my hope that these investigations can be sidelined, based on the cooperation offered by China. But these tools must be available to the White House, should the Chinese fail to cease subsidizing their producers of threonine and lysine.
I applaud the White House’s willingness to try to manage the aggressive rise of China on the global stage. After all, we know that China seeks to use export prowess, not just to grow its economy and expand its middle class, but to also strongarm competitors in an effort to challenge American hegemony, and to unfairly sway geopolitical affairs.
With this in mind, it is critical that we do not allow the Chinese to expand their dominance of the amino acids industry. This is serious business and why this week’s summit between the American and the Chinese leaders was critical for both Iowa and the nation.
Mike Espy, part of President Bill Clinton’s Cabinet from 1993 to 1994, was the first African-American to serve as the U.S. secretary of agriculture, and he served on Agriculture Committee in the U.S. House of Representatives from 1987 to 1992.