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Illinois Pork looks to Thailand, Japan after China tariff losses

By TIM ALEXANDER

SPRINGFIELD, Ill. — Farmer-leaders from the Illinois Pork Producers Assoc. (IPPA) had planned to speak to lawmakers in Washington about the need to be able to resume exports to Thailand even before China announced a 25 percent tariff on U.S. pork imports.

The tariff, announced on April 2, injected extra significance to the need for adding new international markets for Illinois pork. A recent two-day trip to Capitol Hill for the National Pork Producers Council (NPPC) legislative action conference allowed IPPA representatives to speak to all 20 members of the Illinois Congressional delegation or their staff about, among other things, ways to end the 12-year-old Thai embargo on U.S. pork.

IPPA Executive Director Jennifer Tirey was encouraged by the attention the delegation gave the request.

“Congressman Darin LaHood (R-Peoria) is spearheading a letter to Thailand asking them to release their trade barriers,” said Tirey, one of eight IPPA leaders to make the trip. “If we were to lose China, we need to find other markets.”

The Chinese tariff on U.S. pork began on April 1 and is already having an impact on producers, according to Tirey. “We have already started to see a $9 per head loss on our hogs, in just a couple short weeks since that China decision,” she explained on April 20.”To lose $9 really does hurt our farmers’ bottom line.”

The situation is exacerbated by the fact that pork producers had been projected by economists, including Chris Hurt of Purdue University, to likely show a modest profit for the first time in a few years. Tirey said because of the trade war with China and the loss of the Trans-Pacific Partnership (TPP) trade agreement, pork producers will need to find other buyers for their products.

“In addition to Thailand, we are also encouraging negotiations with Japan. When TPP went away, we lost that opportunity, and so we are really encouraging the (Trump) administration to work with Japan,” she said. “We’re also hearing very positive things about the North American Free Trade Agreement (NAFTA), and that is another big trade agreement we are monitoring. We hope to see NAFTA finalized.”

Losing NAFTA would cost the U.S. pork industry $1.5 billion in sales, IPPA leaders told lawmakers during their Washington trip.

Thailand has imposed a number of trade barriers that operate as a de facto ban on the $3.5 billion U.S. pork market. Both the IPPA and the National Pork Producers Council (NPPC), conscious of Thailand’s significant per capita pork consumption and its benefit to both nations, are asking Thai officials to remove all trade barriers.

President Trump, seeking to reduce U.S. trade deficits, visited with Thai Prime Minister Prayut Chan-o-cha last October at the White House and reportedly discussed the U.S. trade deficit of some $19 billion last year with Thailand. The prime minister admitted it was a trade issue that a special committee needs to review, according to news reports.

However, backlash is fierce among Thai pork producers who protested last fall against making any trade concessions to the Trump administration. At least one sign reading “No Poisoned Pork for Thai People, Keep Your Stimulants,” referring to the use of ractopamine in U.S. pork, was spotted, according to Reuters.

Ractopamine is one reason Thailand – which raises about 18 million pigs per year with a market value of around $3.5 billion – rejects U.S. pork imports.

Thai restrictions on U.S. pork exist despite the fact the nation receives enormous benefits from the U.S. Generalized System of Preferences program on exports to the United States. LaHood, in his letter, joined the NPPC in calling for reciprocity from Thailand and asked the nation to expeditiously open its market to U.S. pork.

5/2/2018