In a double-wave of trade news, with the announcement of a trade agreement with Mexico, USDA also provided details of the $12 billion trade mitigation package for U.S. agriculture facing market impact from tariffs.
In the relief package, pig farmers would receive $8 per hog based on 50% of the number of animals they owned as of Aug. 1, 2018. There will be payment limits of $125,000 for the crop program (cotton, corn, soybean, sorghum and wheat) and a separate payment limit of $125,000 for dairy and pork, per producer. The sign up period begins Sept. 4. See more details.
The package includes a nearly $559 million purchase of pork for federal nutrition assistance and child nutrition programs, $200 million for developing foreign markets for U.S. agricultural products and some direct payments to farmers, including pork producers.
Hog prices jumped Monday, as news and indications of the Mexico trade agreement began.
“True to his word that he would have our backs, President Trump today demonstrated his commitment to America’s farmers, including pork producers, by giving us some relief from the financial hit we’ve taken from retaliatory tariffs from some of our biggest trading partners,” says Jim Heimerl, NPPC President and a hog farmer from Johnstown, Ohio.
U.S. pork exports to China are down significantly for the year, with the value falling by 9% through June. The drop has come mostly because of the 50% additional tariff that country imposed in response to U.S. duties on Chinese steel and aluminum imports and on other goods over China’s theft of intellectual property and its forced transfers of U.S. technology. Exports to Mexico are down slightly. In June, it put a 10% tariff on U.S. pork in response to U.S. tariffs on Mexican steel and aluminum imports; the duty increased to 20% on July 5.
“While we’re grateful and commend the administration for its action to help us,” Heimerl said, “what pork producers really want is to export more pork, and that means ending these trade disputes soon.”
More Work to Do
In addition to continuing to press for a swift resolution to the trade wars, NPPC is asking the White House and congressional lawmakers to approve public-policy initiatives that would buoy pork producers, including ones that would:
- Establish and fully fund a Foot-and-Mouth Disease vaccine bank.
- Prohibit states from regulating agricultural production practices outside their borders.
- Reform the visa system to address an agricultural labor shortage.
- Give USDA oversight of lab-produced cultured protein and gene editing in livestock.
NPPC also is urging the administration to quickly conclude talks on a new trade agreement with Mexico, reiterating its priorities of maintaining the zero-tariff rate on pork traded with that country and of lifting the tariffs on steel and aluminum from Mexico so it will drop its retaliatory tariffs on U.S. pork and other products. (The United States and Mexico today announced agreement on a framework for a new trade deal.)
“Pork producers and others in agriculture have been patriots and very patient as the administration rightfully realigns trade policy to make sure our trading partners play by the rules, to ensure that there’s free, fair and reciprocal trade,” Heimerl said.