Category Archives: Tariffs

Tariffs on China Hitting US Farmers, Too

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Pigs at farm near Fuyang city in China’s Anhui province. Photo: AFP via Asia Times

A well-known saying declares there are two things you don’t want to know a lot about: sausage-making, and the process of legislating. Bordering on both those issues is this recent note in Politico,

China would not normally be able to satisfy its consumer demand for pork, even before the epidemic of African swine fever has cut the nation’s pig population in half. Farmers in the United States would, normally, step in to help fill the gap.

But in retaliation to the tariffs placed on Chinese imports by President Donald Trump, pork going to China from the U.S. now faces a 62 percent levy, essentially making American products too expensive for consumers in China. It’s also leaving exporters frustrated that they cannot take advantage of a prime opportunity to gain long-term access to a lucrative market.

American pig farmers are estimated to be losing out on $1 billion in exports as a result of the continued tensions between the two global economic powers.

Whether you agree or disagree with Trump’s tariff actions, you can’t deny that – for good or ill – he is legislating via financial penalties. In one sense, this simplifies the legislative process, in that it forces a change based on a single opinion, or point of view, as opposed to the accepted, ‘normal’ process involving debate between or among varying points of view.

As Politico notes, the use of tariffs relative to China and pig trade isn’t just hurting China – meaning, but not actually, the Chinese government: American farmers, and producers of pig-based products, are being hurt as well; More, from some perspectives.

Asia Times noted a few days ago that, “More than 1.1 million [Chinese] pigs have been killed or culled so far as authorities scramble to contain a [Swine flue] virus that emerged last year… for which there is no vaccine.”

And that’s just the official cull count, the Asia Times notes: “But the figure is widely believed to be much higher, as official data show China’s pig herd totaled 347.6 million in the first half of the year, down 60 million from the same period last year. Pork prices soared by a fifth in June alone.”

“The worst is yet to come,” Jan-Peter Van Ferneij, who monitors foreign markets at the French Pork Institute, said.

“For now it’s the numbers [of pigs] that are falling. Then it will be production … and consumption will fall,” he said.

Pigs

Reassure consumers

But swine fever does not affect humans, and butchers have been seeking to reassure consumers that their meat is safe in the country that produces and eats more pork than anywhere else in the world.

“Look at this blue stamp,” a seller at Beijing’s Sanyuanli market said, pointing to the seal from health authorities showing that the pork is safe. “Here’s the certificate that goes with it,” she added.

Standing in front of pork chops and ribs, Feng Shuyue recalled that people were “scared” of buying the meat last year when the epidemic spread across the country. “Today people are not afraid at all … because the [health] controls are very strict,” Feng said.

To meet demand, Beijing has increased pork imports, with shipments from the European Union rising 37% between January and April, according to European Commission figures.

Brazil has also become a big source of imports.

China is only importing frozen pork and the meat is going to larger cities, according to Jan-Peter Van Ferneij, who monitors foreign markets at the French Pork Institute.

Prices, meanwhile, could go up as much as 40% in the next six months, according to a note by Nomura bank.

Authorities have sought to reassure the public.

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Pork for sale at a wholesale market in Beijing. China is the world’s largest producer and consumer of the meat. Photo: Bloomberg

Earlier this month, agriculture officials said production was “slowly recovering”, with 44 new incidences of fever detected over the past seven months, compared with 99 from August to December last year.

But the malady is far from over. Another outbreak was reported earlier this week in southwest Sichuan province, with 21 pigs infected in a farm of 102 pigs.