Sources are saying that the US agreed to increase low-tariff quota for Japanese beef in bilateral trade negotiations with more beef export at a rate below the 26.4 percent levied on quota-exceeding exports because of the growing rate of Japanese beef exports to the US with the low-tariff limit getting used up by Japan as early as March this year.
Two hundred tons per year is the current export rate of Japanese beef to the US.
The ongoing import duty the US puts on the first 200 tons of Japanese beef is 4.4 cents per kilogram.
Negotiators are removing the quota and are putting Japan in the level of major beef-producing nations like Australia, Canada, and New Zealand.
This would mean Japan can export up to 64,00 tons of beef to the US under the 4.4 cents per kilogram duty.
This rate of import duty can be less than 1 percent depending on the price of beef.
Four hundred twenty-one tons of beef at ¥3.3 billion ($31 million), an amount that grew fourfold in five years, got exported to the US in 2018.
With the rise of Japanese cuisine and the popularity of beef in the United States, exports are expected to grow even more.
US' preference for Japanese beef goes well beyond this in-principle latest arrangement.
Before it pulled out of the Trans-Pacific Partnership (TPP) free trade pact in 2017, America was planning to have a 3,000-ton duty-free quota for Japanese beef and eliminate tariffs in 15 years.
Data from Japan's Agriculture, Forestry and Fisheries Ministry shows that expanding the low-tariff quota will make Japanese beef affordable for Americans because of increased opportunities for businesses to sell.
Japan also agreed to gradually lessen the 38.5-percent tariff on US beef to only 9 percent.
The situation of Japan exporting and importing beef to the US is a two-way or Intra-industry trade.
Because of the arrangement in-principle recently reached with Japan's beef and after a bilateral trade deal takes effect, Japan will remove import tariffs on US wines in seven years.
Japan puts on a 15 percent duty or ¥125 ($1.16) per liter on American wine.
Removal of this tariff could cut the cost of the US for wine distributors by 13 percent.
TPP states that Japan is removing import duties on wine in the coming years after the agreement took effect on December 2018.
Prime Minister Shinzo Abe and President Donald Trump will meet in New York later this month to finalize the two countries' trade deal.
Though it still hasn't been announced yet, Japan is expected to also slash tariffs on US dairy, pork and wheat at around the same levels as the existing trade frameworks.