US Pork Producers Could Suffer Without FTAs

US - The failure of the United States to approve free trade agreements with Colombia, Panama and South Korea would result in the US pork industry being out of those markets within 10 years at a cost to producers of more than $11.50 per pig and to the US economy of thousands of jobs, according to analyses released yesterday by the National Pork Producers Council.
calendar icon 4 May 2010
clock icon 4 minute read

Conducted by Iowa State University economist Dermot Hayes, the analyses take into account the trade agreements the three countries have concluded with other nations. Colombia and Panama recently finalized FTAs with Canada, and South Korea is nearing completion on a deal with the European Union.

NPPC joined with the American Farm Bureau Federation, National Association of Wheat Growers, National Cattlemen’s Beef Association and National Corn Growers Association in decrying congressional inaction on the pending trade deals at a press conference yesterday.

"For us to remain a successful and viable industry, we need new and expanded market access. And the way to get that is through free trade agreements."
Don Butler, President, National Pork Producers Council

“It is clear,” said Don Butler, NPPC immediate past president, “that without new trade agreements, the United States will be going backward by standing still. Our industry can’t afford that; our country can’t afford that.

“For us to remain a successful and viable industry,” added Mr Butler, “we need new and expanded market access. And the way to get that is through free trade agreements.”

Exports are vital to the US pork industry, which last year shipped more than $4.3 billion of pork products, an amount that added about $38 to the price producers received for each hog marketed.

Pork – and other – exports also create jobs, adding to the overall US economy. For every 1 percent increase in the size of the US pork industry, an expansion that would come through a rise in exports, 920 full-time pork industry jobs are created and nearly 4,600 jobs are generated throughout the economy, according to Dr Hayes.

The US-South Korea Free Trade Agreement would add $10 to the price US pork producers receive for each hog marketed and would create more than 3,600 pork industry and 18,000 total jobs. The FTAs with Colombia and Panama would, espectively, add $1.15 and 20 cents to the price of each hog sold and generate 3,500 and 600 pork industry jobs, according to a separate analysis of the FTAs conducted by Hayes.

Congress Should Stop Dragging Its Feet, Says AFBF

American Farm Bureau Federation President Bob Stallman called for Congress to stop dragging its feet and pass the Colombia, Panama and South Korea free trade agreements. In a press conference with other agriculture groups, Mr Stallman said Congress’ inaction on the FTAs is costing US agriculture lost market share and competitiveness.

“We are seeing all around us FTAs being negotiated or already negotiated by our competitors, increasing their export potential and putting the US at a disadvantage,” said Mr Stallman. “The three FTAs combined, which are stalled in Congress, represent almost $2.5 billion in additional exports.”

Because the FTAs have not been implemented, Colombia, Panama and South Korea are moving forward on trade deals with US competitors. Panama has just completed an agreement with Canada and South Korea has completed negotiations with the European Union and is currently negotiating with Canada.

In Colombia, where the US was once the top agriculture exporter, market share is being taken over by other countries. Between 2008-2009, there was almost a 50 per cent drop in US exports. This year, Agriculture Department export data shows that US exports between January and February are 11 percent less than the same time period last year.

“For agriculture, Congress’ inaction on these agreements is no longer about the potential gains, but now about preventing losing what we already have,” said Mr Stallman. “These losses are not just about dollar amounts, but the negative impact they will have on our farmers and rural communities.”

Mr Stallman also said that jobs beyond rural America are at stake, from processors and packers to transportation workers and longshoremen. The USDA estimates that 9,000 US jobs are supported with every billion dollars in exports.

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