June 9, 2017

'US renegotiation of NAFTA could shake up global pork industry'

A renegotiation of North American Free Trade Agreement (NAFTA) by the US has the potential to considerably impact the pig industry worldwide, according to AHDB Pork.

Last month, the Trump administration notified Congress that the US planned to renegotiate the NAFTA, which also includes Mexico and Canada.

The pork division of the UK Agriculture & Horticulture Development Board said that significant volumes of pork are traded between those three countries. The US is also the second-largest global pork exporter. "As such, renegotiation has the potential to considerably impact the pig industry worldwide".

Last year, US pig meat exports (including offal) to Canada and Mexico amounted to over 1 million tonnes, or 42% of the total export volume. Almost 380,000 tonnes of pig meat was also shipped from Canada to the US, around a third of Canadian pig meat exports.

AHDB Pork said the potential loss of tariff-free access for US pork to the Mexican market would likely result if the US is not satisfied with the negotiations and decides to withdraw from NAFTA. In 2016 Mexico imported 1 million tonnes of pig meat of which 99% was supplied by the US and Canada.

AHDB Pork also said that Canada could maintain tariff-free access for pork shipments into Mexico and therefore be at a competitive advantage. "On top of this, the EU is currently renegotiating the Mexico-EU trade deal with a commitment to conclude it by the end of this year. Tariff-free access could be granted to EU pork as a result of this, further damaging the export prospects of US pork".