Pork Producers Missing ‘Single Greatest Sales Opportunity’ in China Due to Trade Dispute
“It has been estimated that China will lose more pork [as a result of African swine fever] than the United States produces.”
That estimate is according to Dr. Dermot Hayes, an economist at Iowa State University. China is the largest consumer of pork in the world. However, its swine herd has been ravaged by ASF, significantly reducing domestic production and increasing pork imports. HOTH believes this represents the single greatest sales opportunity in our industry’s history.
Unfortunately, U.S. pork producers have been hamstrung by a 50 percent punitive tariff from China, on top of the existing 12 percent duty, hampering growth and providing an unfair advantage to competitors.
America’s pork producers – and many other farmers – have been at the tip of the retaliation spear for more than a year. 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. Last year, Mexico was the industry’s largest volume market and China was the third top market by volume, although import tariffs imposed by those two countries have cost U.S. pork producers $2.5 billion over the last year.
HOTH believes the U.S. should be working to expand exports by opening new markets and improving access where it already exists. While Mexico’s 20% import duty on U.S. pork was recently lifted, America’s producers still face a stifling 62% tariff into China. Pork producers outside of China have watched these developments and many are making plans to supply China with the pork it needs. U.S. pork production costs are among the lowest in the world and, were it not for the retaliatory duties, the United States would be in a perfect position to take advantage of this long-term import surge.
Eliminating all tariff and non-tariff barriers to trade would create a huge opportunity for U.S. pork producers who are highly dependent on export markets. Dr. Hayes estimates that if China purchased at least 350,000 tons of U.S. pork each year for five years, the value of U.S. pork exports to China would grow to approximately $3.5 billion in sales.
Additionally, HOTH is pushing for the U.S. to quickly complete a trade deal with Japan, our largest value market and second largest volume market for U.S. pork exports, and ratification of USMCA. Exports to Canada and Mexico support 16,000 U.S. jobs.