For the Week Ending September 21, 2018

September 21, 2018

U.S., CHINA TRADE DISPUTE ESCALATES

The Office of the U.S. Trade Representative this week released a list of approximately $200 billion of Chinese goods subject to an additional U.S. import tariff. The new 10 percent tariff will be become effective Sept. 24. Beginning Jan. 1, 2019, the tariff will increase to 25 percent. In response, the Chinese government indicated it will impose additional tariffs on $60 billion of U.S. goods exported to China. U.S. pork is on two Chinese retaliation lists, suffering from significant punitive tariffs. NPPC is urging the Trump administration to end trade disputes as soon as possible, so the U.S. pork industry can send product to its No. 3 export market.

 

U.S., KOREA EXPECTED TO SIGN REVISED TRADE DEAL

President Trump this week announced that the United States and South Korea soon will sign the revised free trade agreement between the countries. The agreement, which was finalized earlier this year, could be signed as early as Sept. 25, during the United Nations General Assembly meeting, according to President Trump. The U.S.-Korea Free Trade Agreement, or KORUS, was one of several trade agreements scrutinized by the president during his 2016 election campaign. NPPC was pleased with the outcome of the renegotiations, with the new deal having little impact on agriculture. Most U.S. pork will continue to flow to South Korea with no tariff. (Prior to KORUS, Korean duties on U.S. chilled and frozen pork were 22.5 percent and 25 percent, respectively.) Last year, the United States shipped $475 million of pork to South Korea – a 30 percent increase over 2016 – making it the No. 5 U.S. pork export market.

 

WOTUS INJUNCTION NOW INCLUDES IOWA

The U.S. District Court for the District of North Dakota this week added Iowa to the list of 12 states that do not need to implement the 2015 Waters of the United States (WOTUS) rule. In August 2015, that court issued a preliminary injunction against the regulation for Alaska, Arizona, Arkansas, Colorado, Idaho, Missouri, Montana, Nebraska, Nevada, New Mexico, North Dakota, South Dakota and Wyoming. Last week, a U.S. District Court in Texas granted an injunction for Louisiana, Mississippi and Texas, and in June, a U.S. District Court in Georgia granted one for Alabama, Florida, Georgia, Indiana, Kansas, Kentucky, North Carolina, South Carolina, Utah, West Virginia and Wisconsin. The WOTUS rule, now enjoined in 28 states, was issued by the U.S. Environmental Protection Agency to clarify its jurisdiction under the Clean Water Act over “navigable” waters. The Obama-era regulation dramatically expanded the agency’s jurisdiction to include, among other water bodies, upstream waters and intermittent and ephemeral streams such as the kind farmers use for drainage and irrigation. It also covered lands adjacent to such waters. The Trump EPA in January delayed the rule’s effective date until 2020 — a move applauded by NPPC – and agreed to work with stakeholders, including farmers, on a new regulation. Last month however, the U.S. District Court for the District of South Carolina overturned the delay, agreeing with environmental groups that the Trump administration did not follow the Administrative Procedures Act when suspending the rule, and reinstated the regulation for the 26 states where it hadn’t been blocked.

 

NORTH CAROLINA PORK PRODUCERS RECOVERING FROM HURRICANE FLORENCE

In the aftermath of Hurricane Florence, North Carolina’s hog farms are returning to normal operations. For a small portion of pork producers, logistical challenges amid record levels of flooding remain, with some producers taking extraordinary steps to ensure the well-being of their animals. The storm caused the loss of 5,500 hogs, a number the North Carolina Pork Council (NCPC) does not expect to increase significantly. The state Department of Environmental Quality is reporting five manure lagoons with possible structural damage and three believed to be breached. Operations are underway to lower lagoon levels by transferring liquids. NCPC is continuously monitoring the situation and supporting producers feeling the effects of Florence. Click here for additional updates on Hurricane Florence.

 

FMCSA EXTENDS PUBLIC COMMENT PERIOD ON HOURS-OF-SERVICE RULES

The U.S. Department of Transportation’s Federal Motor Carrier Safety Administration (FMCSA) this week extended the deadline for submitting public comments on revising current Hours-of-Service (HOS) rules, which limit certain commercial truckers to 11 hours of driving time and 14 consecutive hours of on-duty time in any 24-hour period. Once drivers reach that limit, they must pull over and wait 10 hours before driving again. Comments now are due by Oct. 10. In response to congressional, industry and public concerns about the incompatibility of current HOS rules for industry-specific truck drivers, including livestock haulers, the FMCSA agreed to consider changes to the regulation in four areas: expanding the current 100 air-mile “short-haul” exemption from 12 hours on-duty to 14 hours on-duty; extending the current 14-hour on-duty limitation by up to two hours when a truck driver encounters adverse driving conditions; revising the current mandatory 30-minute break for truck drivers after eight hours of continuous driving; and reinstating the option for splitting the required 10-hour off-duty break for drivers operating trucks that are equipped with a sleeper-berth compartment. NPPC continues to seek a limited exemption for livestock haulers from the DOT’s Electronic Logging Device (ELD) mandate, which requires truckers to replace their paper driving logs with electronic ones. A fiscal 2018 federal spending law delayed the mandate for livestock truckers until Oct. 1, 2018.