Chicken feet are a lowly thing. They scratch in the dust and shuffle over crowded cage floors. In the U.S. poultry market, feet usually end up being ground into parts for feed. But they are a delicacy in China, where consumers prefer the taste of meat on the bone. The natural scarcity of chicken feet (each animal, after all, has only two) means that a plateful of "phoenix talons," as they are called, imparts a measure of prestige on diners who order them.
And so, despite their humble nature, chicken feet have an outsize significance in the U.S.-China trade relationship, as a product for which the U.S. holds the advantage over China's export machine. China's production of chicken isn't nearly enough to satisfy its domestic market; in recent years, the U.S. has been the source of about half of China's imports of feet. While Beijing's announcement last week of tariffs on imports of U.S. chicken parts won't have a huge effect on the total flow of goods between the two nations, it is symbolic of a fraying trade relationship.
On Feb. 5, China's Ministry of Commerce announced it would begin imposing antidumping tariffs ranging from 43.1% to 105.4% on imports of chicken parts from the U.S. China began an investigation into U.S. chicken exports in September after President Obama announced tariffs of up to 35% on tire imports from China. Last week Obama signaled that the U.S. would also take a tougher stand on Chinese currency, which economists say is undervalued by as much as 40%, driving down the price of Chinese exports.
The China Animal Agriculture Association, a trade group, asked for an investigation into chicken prices in August 2009 after its members complained of being undercut by American imports. "They couldn't sell their products and were losing a lot of money," says Ma Xiang, the association's deputy secretary-general. "We investigated this situation and found out the import of American chicken parts made the competition in the domestic market very severe."
In 2008 the U.S. exported $677 million worth of chicken to China, according to the USDA, a fraction of the total $36 billion U.S. poultry market. Roughly half of those exports were chicken feet, worth $0.60 to $0.80 per pound on the Chinese market but just pennies in the U.S.
American poultry producers say the fact that chicken feet sell for much higher prices on the Chinese market than they would go for in the U.S. proves they are not being dumped or sold below cost. Jim Sumner, president of the USA Poultry and Egg Export Council, argued in a Feb. 5 statement that U.S. chicken farmers were the victims of broader trade friction between the two sides, including U.S. unwillingness to further open its domestic market to chicken products from China. "Unfortunately, U.S. poultry is a big target, and we have simply gotten caught in the cross fire," Sumner said.
The new tariffs, which go into effect Feb. 13, will price American chicken feet out of the Chinese market, says Sumner. The immediate result will be that in China, the price of America's unwanted "phoenix talons" will grow to something more reflective of their illustrious name.
With reporting by Chengcheng Jiang