By Nick Giordano, NPPC Vice President and Counsel, Global Government Affairs
It was a great day in late September when President Donald Trump and Japanese Prime Minister Shinzō Abe signed a trade agreement that, among other issues, will virtually eliminate all protection on U.S. pork in Japan in the coming years. NPPC President David Herring, President-Elect Howard "A.V." Roth and myself were invited by the administration to participate in the signing event. The signing ceremony was a culmination of numerous years of NPPC’s efforts to obtain expanded market access for pork in Japan. The agreement is expected to be implemented early next year.
During the Obama administration, NPPC’s top trade policy objective was to have U.S. pork on a level, competitive playing field with domestic pork in Japan through the Trans-Pacific Partnership (TPP) negotiations. Former U.S. Trade Representative Ambassador Michael Froman and other Obama administration trade officials repeatedly heard this message from U.S. pork producers. NPPC’s advocacy campaigns are legendary in trade policy circles and led to a fantastic TPP outcome for U.S. pork.
However, the TPP outcome never materialized, as the Trump administration moved away from regional trade deals in favor of bilateral deals. Undeterred, in January 2017, NPPC was the first organization to publicly call for a bilateral trade deal with Japan.
For the next two and a half years, NPPC producers, leadership, staff, and rank and file members from around the nation redoubled their efforts to impress upon the administration and Congress the need for a rapid trade deal with Japan. The stakes intensified as the European Union and other nations such as Canada, Chile and Mexico — in the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership — finalized trade deals with Japan, which were implemented in 2019.
To its credit, the Trump administration understood time was of the essence. A full-blown trade agreement would have to go through Congress, which meant implementation after the elections and probably not until January 2022. For NPPC, such an outcome was unacceptable and would have resulted in significant loss of market share in Japan.
The economic benefits of this trade agreement with Japan are substantial. Japan is the largest value market and the second-largest volume market for U.S. pork exports. U.S. pork exports to Japan support 13,100 U.S. jobs. Dermot Hayes, an economist at Iowa State University, estimates U.S. pork exports to Japan could grow from $1.6 billion in 2018 to more than $2.2 billion over the next 15 years under market access terms included in the agreement.
NPPC is hopeful the tide is turning on trade. Earlier this year, NPPC pushed back hard against metal retaliation by Mexico and worked to find a solution to this dispute. Mexican retaliation (which included 20% punitive tariffs) was taking $12 off the price of every hog sold in the country, according to Hayes.
NPPC is now putting on a full-court press to get the U.S.-Mexico-Canada Agreement (USMCA) through Congress this year. In addition to producer and staff lobbying activities, NPPC will be rolling out a major USMCA campaign soon.
China continues to be a matter of paramount importance for NPPC and the organization was buoyed by the recent Chinese announcement that the country would exclude pork from punitive tariffs. While the scope and duration of the exclusion has not been officially confirmed, U.S. pork is moving to China. NPPC is advocating for a permanent exclusion from the punitive Chinese tariffs on U.S. pork. Given the spread of African swine fever in China, U.S. pork exports can help China keep food price inflation manageable.
With Mexican retaliation in the rear-view mirror, the Japan deal in hand, and U.S. pork flowing to China, pork producers increasingly can get back to playing offense on trade. NPPC is working closely with the Trump administration on the elimination of tariff and non-tariff barriers in a variety of export markets, including Vietnam, the Philippines, Thailand, Australia, South Africa, Ecuador, Jamaica and Brazil. NPPC looks forward to gaining new market access for U.S. pork.
Nick Giordano is Vice President and Counsel, Global Government Affairs. He leads NPPC’s Washington, D.C. office and is involved in all aspects of policy issues as they impact the interests of U.S. pork producers.
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