U.S. Trade Representative Katherine Tai spoke with China’s top trade official Wednesday night in an “introductory virtual meeting” as the Chinese continue to make big purchases of U.S. agricultural commodities and the U.S. farm sector counts on strong trade to continue.

Tai, according to a statement released by the Office of the USTR, raised “issues of concern” in her conversation with Chinese Vice Premier Liu He, and American Farm Bureau Federation Senior Director of Congressional Relations David Salmonsen says it’s good that the two countries are talking trade.

“It’s good that they’re talking on the trade front … and we hope they can move forward and keep talking and move to a phase two agreement,” Salmonsen told Agri-Pulse.

The U.S. and China last year signed the Economic and Trade Agreement Between the Government of the United States of America and the Government of the People’s Republic of China, known more commonly as the “phase one” deal. Under that deal, China agreed to drastically boost its imports of U.S. ag commodities as well as make significant policy changes, such as lifting its zero-tolerance for growth hormones in beef and making its biotech approval process quicker and more transparent.

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The USDA’s Economic Research Service on Wednesday raised its forecast for U.S. agricultural exports in the 2021 fiscal year to a record-breaking $164 billion, largely on massive shipments to China.

“Exports for China are raised $3.5 billion from the February forecast to a record $35 billion due to record shipments of soybeans, corn, tree nuts, beef, wheat, and poultry products,” ERS said in the Wednesday report. “China is forecast to remain the largest market for U.S. agricultural exports in FY 2021, followed by Canada and Mexico.”

As to whether the U.S. and China will sit down to hold new trade talks and potentially come up with a “phase two” deal, Tai told Liu that USTR’s comprehensive review of the U.S.-China trade relationship is still “ongoing.”

“We are drilling down at USTR, using the usual discipline that we have to look at the overall compliance picture and to examine China’s performance under this agreement and all of its component parts,” Tai said last month in a Senate hearing. “We’re still in the middle of a review.”

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