Capital Update – For the Week Ending September 22, 2023
In this week’s National Pork Producers Council (NPPC) Friday recap: NPPC Past President testifies on GSP before House Subcommittee, NPPC team attends Leman Swine Conference, and July U.S. pork exports maintain record pace. Take a deeper dive below.
MN Pork Producer Randy Spronk Testifies on GSP Renewal
What happened: NPPC this week urged congressional lawmakers to renew the U.S. Generalized System of Preferences (GSP) program, which expired at the end of 2020. Testifying on behalf of NPPC, Randy Spronk, a Minnesota pork producer and NPPC past president, told the House Committee on Ways and Means Trade Subcommittee that pork producers support GSP because it helps developing countries grow their economies, climb out of poverty, and, eventually, become export markets for U.S. pork. The program has also been used as a trade enforcement tool, giving U.S. trade negotiators leverage to address market access issues.
Why it’s important: GSP provides duty-free treatment of goods exported to the United States from beneficiary developing countries. In turn, GSP-eligible countries are required to meet certain statutory criteria set by Congress, including market access for U.S. goods. Should countries fail to meet those requirements, the United States can withdraw GSP benefits.
In 2017, GSP was successfully used to obtain market access for U.S. pork producers in India, which at the time was the number one recipient of preferential GSP trade benefits, despite restricting or prohibiting the importation of many U.S. agricultural products, including pork. When Argentina was considered for the GSP program in 2018, the U.S. Department of Agriculture used that leverage to finalize an export certificate for U.S. pork with the South American country.
NPPC’s take: NPPC supports the renewal of GSP, as it is a valuable program that gives U.S. trade negotiators another tool to persuade countries to eliminate trade restrictions on U.S. products, including pork.
NPPC also supports adding to the program stronger enforcement mechanisms that can help prompt countries to meet their GSP obligations.
Click here to watch the full hearing.
Randy Spronk (left) testifying before the House Ways and Means Trade Subcommittee.
NPPC Team Attends Leman Swine Conference
What happened: NPPC Vice President of International Affairs Maria C. Zieba, Director of Food Policy Dr. Ashley Johnson, Chief Legal Strategist Michael Formica and Director of Industry Resource Development Julie Schwalbe this week attended the 2023 Allen D. Leman Swine Conference, hosted by the University of Minnesota College of Veterinary Medicine. The conference highlights science-driven solutions to the complex challenges facing the swine industry.
Why it’s important: Veterinarians attending the conference heard updates on the progress the U.S. Department of Agriculture is making in preparing for African swine fever (ASF), as well as discussions on Porcine Reproductive and Respiratory Syndrome, disease diagnostics, secure food systems, the cost of production, gene editing and many other issues facing the pork industry. Additionally, there were multiple workshops on various topics, including diagnostic collection, ASF detection and surveillance, and Porcine Endemic Diarrhea virus control and elimination. They also heard an update on the current status of implementing California’s Proposition 12 and Massachusetts Question 3 and congressional efforts to address it.
NPPC action: As part of a workshop on ASF and foreign animal diseases, Zieba met with government officials from the Philippines and Vietnam to discuss a program launched last year by USDA’s Foreign Agricultural Service and the University of Minnesota – and endorsed by NPPC – to build capacity for risk assessments to support safe international trade of U.S. pork products with countries battling ASF. Also attending the workshop were veterinarians from Colombia, the Dominican Republic and Japan, who offered their experiences with foreign animal diseases.
Also at the conference, Randy Spronk, a pork producer from Minnesota and NPPC past president, presented on the importance of exports to the swine industry and about export opportunities.
NPPC’s Michael Formica participated in a breakout session that focused on the latest legal and legislative updates on California Proposition 12.
NPPC Vice President of International Affairs Maria Zieba (seated) with government officials from the Philippines and Vietnam, Mario Peña DVM from PorkColombia (middle back row) and Dr. Andres Perez DVM, PhD, University of Minnesota (back row).
July U.S. Pork Exports Maintain Record Pace
What happened: U.S. pork exports continued their upward trend in July, according to data from the U.S. Department of Agriculture, with volume up 5% at more than 219,000 metric tons (MT) and value up 1% to $628.7 million from the same period last year. For the first seven months of the year, pork exports were 13% higher in volume at nearly 1.7 million MT and 10% higher in value at $4.67 billion, compared with the amounts in 2022.
Destinations for U.S. pork: Mexico continued to be the number one destination for 2023 U.S. pork exports, with July’s volume up 15% to more than 81,000 MT and value up 12% to more than $189 million from July 2022. For the first seven months of 2023, volume was up 14% to 614,015 MT, and value was higher by 20% to $1.26 billion, compared with last year.
Other top markets over the first seven months of 2023 included China/Hong Kong, with exports up 18% year-over-year; Canada is 11% above last year; and South Korea, which imported 6% more U.S. pork compared with the January-July 2022 amount.
Although they are smaller markets, there were significant increases in U.S. pork exports to Australia and New Zealand, with January-July exports up 74% from a year ago; the Association of Southeast Asian Nations (ASEAN) of Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam – particularly Malaysia, the Philippines and Vietnam – which saw a combined 51% increase in pork exports compared with the first seven months of 2022; and the Dominican Republic, which imported 26% more U.S. pork compared with the same period last year.
What it means for producers: July pork exports equated to $65.38 per hog, down 3% from a year ago, but the January-July average increased by 8% to $64.37. Exports accounted for 25.1% of total July pork production, up 0.6% from a year ago. For the first seven months of the year, 2023 exports accounted for 25.2% of total output compared with 23.4% for the same period in 2022.