Calling for More Trade Deals

WASHINGTON (DTN) -- The nation's pork producers need more free-trade agreements, particularly with Japan, in order to export some of the pork that will be processed in five new plants that will begin production in the next few years.

National Pork Producers Council officials met with reporters on Thursday to stress some of their top issues, which revolved heavily around trade. NPPC was perhaps the biggest backer of the Trans Pacific Partnership from which President Donald Trump has withdrawn, but officials said the expectation that that agreement would be concluded was only one of the reasons that the new plants are being built in Missouri, southwestern Minnesota, Sioux City and Wright County, Iowa, and Coldwater, Michigan.

The new plants are needed as part of "a modernizing of an industry that is quite old," said Ken Maschoff, the NPPC president.

Nick Giordano, the council's vice president for trade, acknowledged that pork producers are "very disappointed" that TPP was not finalized, "but you have to accept the reality."

Pork producers have delivered a message to federal lawmakers this week and to the Trump administration that bilateral free-trade negotiations should begin with Japan, the officials said. The producers are looking to Vice President Mike Pence's upcoming trip to Japan for signals on that effort, Giordano said.

Yet, any new trade deals may be slow in coming. The Trump administration has yet to get a committee vote in the Senate for the president's nominee for U.S. trade representative, Robert Lighthizer. His nomination is tied up in a dispute raised by Democrats over whether Lighthizer needs an ethics waiver because of lobbying he did in the 1980s.

Under law, a renegotiation of the North American Free Trade Agreement, which Trump has made one of his objectives, would require the participation of the U.S. trade representative.

There have also been reports that Trump is understaffed for meetings with the Chinese because the U.S. trade representative has not been confirmed and lower-level appointments at USTR have not been made.

NPPC is telling the Trump administration to focus on the Asia-Pacific region rather than Europe because the European Union has so many unscientific regulations, Giordano said. After Brexit, the United Kingdom is another possible market for negotiation, he added.

The pork producers are also very aware that Vietnam has signed a trade agreement with Vietnam and is attempting to get an agreement with Japan and Mexico, Giordano noted.

The European Union and Canada are U.S. pork producers' biggest competitors, but Chile and Mexico are competitors too, the officials said.

Pork producers are also concerned about renegotiation of the North American Free Trade Agreement because the tariff elimination in NAFTA has resulted in a big increase in exports to Mexico, they said.

On other issues, the pork producers believe in tax reform in general, but have not taken a position on the proposed border adjustment tax, Giordano said.

The border adjustment tax would increase the cost of imports, but the pork producers do not use as many imported inputs as grain producers, the officials said. But there is a fear that a border tax could lead to retaliation, one official added.

Pork producers are also asking Congress to use the next farm bill to establish a vaccine bank, and they want more monitoring of the impact of antibiotics in animal and human health, said Liz Wagstrom, the group's veterinarian.

The Trump administration's proposed budget cuts to discretionary spending at USDA are "worrisome," Wagstrom said.

(CC/AG)

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