December 5, 2018

US pork losses from trade dispute with Mexico amount to US$1.5 billion

On November 30, the National Pork Producers Council (NPPC) had called for an end to a trade dispute that has cost US pork producers an estimated US$1.5 billion this year, according to Iowa State University economist Dermot Hayes.

"We are very pleased with the new trade agreement with Mexico and Canada, one that preserves zero-tariff pork trade in North America for the long term," said NPPC president Jim Heimerl. "But, it's imperative that we remove US tariffs on Mexican metal imports so that retaliatory tariffs of 20% against US pork are lifted."

Dr. Hayes estimated that live hog values this year have been reduced by US$12 per animal due to retaliatory tariffs imposed by Mexico against US pork in June. The loss estimate of US$1.5 billion is based on an expected total harvest of 125 million hogs in 2018. These tariffs, along with China's retaliatory tariffs, have turned what promised to be a profitable year into a year of losses for export-dependent US pork producers.

Dr. Hayes also estimated US pork producer losses of US$1 billion, or US$8 per animal, from the ongoing trade dispute with China.

Mexico and China represent approximately 40% of total US pork exports.

- National Pork Producers Council