Trade disputes costing meat industry billions

Meat groups welcome signing of USMCA and moving toward ending China trade dispute.


Jacqui Fatka, Feedstuffs

Dec 03, 2018


The news of a potential holding off on implementation of additional tariffs with China and the U.S.-Mexico-Canada Agreement (USMCA) were welcome news to the meat industry, which continues to suffer from the lingering impacts of the ongoing trade woes created from the North American trade deal uncertainty and the trade dispute with China.


Iowa State University economist Dermot Hayes estimates that the trade dispute has cost U.S. pork producers an estimated $1.5 billion this year.


National Pork Producers Council president Jim Heimerl, a pork producer from Johnstown, Ohio, said, “We are very pleased with the new trade agreement with Mexico and Canada, one that preserves zero-tariff pork trade in North America for the long term, but it’s imperative that we remove U.S. tariffs on Mexican metal imports so that retaliatory tariffs of 20% against U.S. pork are lifted.”


Hayes estimated that live hog values this year have been reduced by $12 per animal due to retaliatory tariffs Mexico imposed against U.S. pork in June. The loss estimate of $1.5 billion is based on an expected total harvest of 125 million hogs in 2018. These tariffs, along with China’s retaliatory tariffs, have turned what promised to be a profitable year into a year of losses for export-dependent U.S. pork producers. Hayes estimated U.S. pork producer losses of $ 1 billion, or $8 per animal, from the ongoing trade dispute with China.


Mexico and China represent approximately 40% of total U.S. pork exports.


U.S. Meat Export Federation (USMEF) president and chief executive officer Dan Halstrom said USMEF supports the Trump Administration’s efforts to finalize USMCA and to continue seeking resolution to the metal tariffs dispute with Mexico and Canada, which resulted in retaliatory duties on U.S. pork and beef.


“U.S. meat exports have become entangled in trade disputes with China, so it is encouraging to see the U.S. and China return to the negotiating table. Global demand for U.S. red meat is very strong, but exports cannot reach their full potential until the retaliatory duties imposed by Mexico, China and Canada are removed,” Halstrom noted.


In the latest agricultural trade outlook released by the Economic Research Service on Nov. 29, ERS projected...