National Pork Producers Council says if news is true, it would be huge breakthrough for US pork industry
China’s Customs Tariff Commission of the State Council intends to remove punitive tariffs on U.S. pork and soybeans, as well as some other agricultural goods from the United States, according to Chinese media outlet Xinhua.
Chinese negotiators are expected Washington in early October to meet with U.S. Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer, ABC reported, and Mnuchin said mid-level U.S. and Chinese officials were due to meet within the next two weeks to prepare.
The move followed the United States’ decision to make adjustments to the additional tariffs to be imposed on Chinese goods on October 1.
It also comes at a time when the Chinese pork industry is suffering amid an outbreak of African swine fever (ASF). It has been estimated that as much of half of China’s pig herd has been lost to ASF.
NPPC responds
“If media reports are accurate, this is a most welcome development,” David Herring, president of the National Pork Producers Council (NPPC) said in a statement. “The Chinese have placed punitive tariffs of 60% on most U.S. pork products, bringing the effective tariff rate on most U.S. pork to 72%.
“According to Iowa State University economist Dermot Hayes, the Chinese retaliation on U.S. pork has shaved $8 off the price of every hog sold in the United States for well over a year. Most of our competitors face only a 12% tariff on their pork exports to China. Pork is somewhat unique given that it is the most important protein consumed in China, accounting for a significant part of the consumer price index.”
Herring also pointed out the current ASF situation in China, which is the world’s largest producer and consumer of pork.
“U.S. pork exports could single handedly make a huge dent in the trade imbalance with China,” he said. “We are hopeful that this apparent gesture of goodwill by China leads not only to more sales of U.S. pork, but that it contributes to a resolution of U.S.-China trade restrictions.”
Implications for soybean industry
Soybeans are a major feed ingredient for the pig industry, which is also expected to bode well for U.S. soybean producers.
While a recent U.S. Department of Agriculture report stated ASF losses have Chinese soybean meal consumption to drop to a four-year low, a demand continues. An agreement was reached in early September that would enable China to start importing soybean meal from Argentina.
View our continuing coverage of the African swine fever outbreak.
