Tag Archives: National Pork Producers Council

Expanding U.S. export markets is vital to the success of American pork producers, but trade disputes with some of our top markets, most notably China, are hampering growth and have caused severe financial harm to U.S. hog farmers, National Pork Producers Council Vice President and Counsel of Global Government Affairs Nick Giordano said today at a Global Business Dialogue event in Washington, D.C.

“Mostly because of free trade agreements, the United States is the leading global exporter of pork. As a result, U.S. pork is an attractive candidate for trade retaliation. America’s hog farmers – and many other sectors of U.S. agriculture – have been at the tip of the trade retaliation spear for more than a year,” Giordano explained to the briefing at the National Press Club.

 

While Mexico’s 20 percent retaliatory tariff on U.S. pork was recently lifted, America’s producers still face a stifling 62 percent tariff into China. There are enormous trade opportunities with China, especially to help offset reduced domestic production due to African swine fever (ASF), a pig-only disease with no vaccine treatment that poses no human health or food safety risks, but that is almost always fatal for hogs, Giordano noted.  ASF has spread to every province in China, other parts of Asia and in Europe.

Giordano said NPPC is working with the U.S. Department of Agriculture and Customs and Border Protection to strengthen biosecurity at our borders and on our farms to prevent its spread to the United States.

“We have always known that China holds more potential than any market in the world for increased U.S. pork sales. But, today, because of African swine fever, that potential is off the charts, offering the single greatest sales opportunity in our industry’s history,” said Giordano. “China needs reliable suppliers of pork now, and likely, well into the future. The question U.S. hog farmers are asking: ‘Will we get the main course, or will we get the crumbs off the table?'”

“For most of the last year, the U.S. pork industry has the dubious distinction of being on three retaliation lists: China and Mexico related to U.S. actions under Section 232 of the Trade Expansion Act of 1962 and China in response to U.S. tariffs imposed under Section 301 of the Trade Act of 1974,” Giordano said. Last year, Mexico was the industry’s largest volume market and China was the third top market by volume, although punitive tariffs imposed by those two countries have cost U.S. pork producers $2.5 billion over the last year.

“U.S. pork production costs are among the lowest in the world with safety and quality that are second to none. But for the retaliatory duties, the United States would be in a perfect position to take advantage of this massive import surge in the world’s largest pork-consuming nation and single handedly put a huge dent in the U.S. trade imbalance with China,” Giordano said. Instead, Chinese pork buyers are reaching out to those in Europe, Canada and Brazil for supplies. “What should have been a time of enormous prosperity and growth for U.S. pork producers and their suppliers will instead fuel jobs, profits and rural development for our competitors,” he noted.

“U.S. hog farmers understand the challenges faced by this administration in recalibrating U.S. trade policy toward China. The issues are myriad and complex. Moreover, hog farmers appreciate the farmer aid packages that the administration has put forward,” Giordano continued. “However, the China pork tariff needs to be lifted.”

Giordano’s full remarks can be read here.

The Trump administration today announced plans to lift the 25% tariff on steel and the 10% duty on aluminum imports imposed last year on Canada and Mexico. Both countries subsequently retaliated against a host of U.S. products.

“We thank the administration for ending a trade dispute that has placed enormous financial strain on American pork producers,” said David Herring, a pork producer from Lillington, N.C., and president of the National Pork Producers Council. “Mexico’s 20% retaliatory tariff on U.S. pork has cost our producers $12 per animal, or $1.5 billion on an annualized, industry-wide basis. Removing the metal tariffs restores zero-tariff trade to U.S. pork’s largest export market and allows NPPC to focus more resources on working toward ratification of the U.S.-Mexico-Canada Agreement (USMCA), which preserves zero-tariff trade for U.S. pork in North America.”

Last year, Canada and Mexico took over 40% of the pork that was exported from the United States. NPPC has designated USMCA ratification as a “key vote” and will closely monitor support of the agreement among members of Congress. U.S. pork exports to Mexico and Canada support 16,000 U.S. jobs.

“We are also hopeful that the end of this dispute allows more focus on the quick completion of a trade deal with Japan,” Herring added. “U.S. pork is losing market in its largest value market to international competitors that have recently implemented new trade agreements with Japan.”

According to Dr. Dermot Hayes, an economist at Iowa State University, U.S. pork will see exports to Japan grow from $1.6 billion in 2018 to more than $2.2 billion over the next 15 years if the U.S. quickly gains access on par with international competitors. Hayes reports that U.S. pork shipments to Japan will drop to $349 million if a trade deal on these terms is not quickly reached with Japan.