Central America continues to solidify its position as a premier growth market for U.S. red meat, driven by the enduring stability of the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR).
That was the primary takeaway from Ricardo Zúñiga, founding partner of Dinámica Americas, during his keynote at the U.S. Meat Export Federation (USMEF) Spring Conference. Zúñiga notes that while the trade environment has been difficult, CAFTA-DR has proven its resilience.
Advocacy Saved the ‘Floor’ for Trade
The agreement recently weathered a significant storm. A Section 301 tariff investigation involving Nicaragua — initially sparked by the textile industry — threatened to dismantle the benefits of the agreement. However, Zúñiga credited collective industry advocacy for keeping the trade floor intact.
“CAFTA-DR is the engine for trade with the region that’s leveled the playing field for U.S. meat exporters,” Zúñiga says. “It was almost dismantled over a 301 investigation, but it was industry voices that prevented that from happening and kept supply chains together. CAFTA is now the floor. It’s no longer likely to go away.”
A High-Stakes Market
The economic impact of the region is substantial for both beef and pork producers. Despite this bullish outlook, Zúñiga cautions that several external factors could depress demand in the coming year:
- The Remittance Economy: Central American purchasing power is heavily dependent on funds sent home by relatives working in the U.S. Increased border enforcement or deportations could lead to a reduction in these remittances, tightening consumer budgets for imported proteins.
- Iran War: Regional stability and shipping could be impacted by ongoing Middle East conflicts involving Iran.
- U.S. Economic Linkage: The region’s economic health remains a mirror of the U.S. economy. “If things go well in the United States, Central America tends to do well,” Zúñiga adds.
The Path Forward
Zúñiga emphasizes the survival of these agreements depends on producers and industry leaders remaining vocal. By staying involved in the policy process, the meat industry ensures that Central America remains a reliable and growing destination for U.S. red meat.
For more information and updates from the Spring Conference, visit USMEF.org.
