USMEF addresses challenges to trade

Meat & Poultry, Nov. 1, 2017 - by Erica Shaffer

KANSAS CITY, Mo. – Representatives with US Meat Export Federation (USMEF) took a break from the Annual Strategic Planning Conference in Tucson, Arizona, to highlight the successes of US red meat exporters while speaking to the challenges exporters face trying to advance in foreign markets amid North American Free Trade Agreement (NAFTA) renegotiations and scrutiny of other FTAs.

Oscar Ferrara, USMEF regional director for Mexico, Central America and the Dominican Republic, said consumption of US red meat products has increased in Mexico and Latin America. He noted that customers “are really depending on US exports” as countries expand processing operations for beef and pork.

“We have a situation right now where the [NAFTA] negotiations are creating a lot of uncertainty in the market,” Ferrara explained. “We have seen delegations looking for alternate markets” in Brazil and other South American countries.

The prospect of withdrawing from well-established free trade agreements is one that USMEF and its constituents take seriously. USMEF was one of 87 food and agricultural organizations to express concerns about the negotiations in a letter to Wilbur Ross, secretary of commerce. The groups disputed Ross’s assertions that the threat to American agriculture from a US withdrawal from NAFTA was an “empty threat.”

The groups noted in the letter that, under NAFTA, Mexico and Canada account for nearly 40 percent of US pork export volume. On the beef side, exports to Mexico and Canada exceeded $1.7 billion in 2016 and accounted for 27 percent of total US beef exports.

US agriculture stakeholders are not alone in their worry. In an Oct. 25 memo obtained by The Canadian Press titled “Napping on NAFTA,” former Canadian Prime Minister Stephen Harper said he was alarmed by what he heard during a recent trip to Washington.

“I fear that the NAFTA re-negotiation is going very badly,” he wrote to clients of his consulting firm, Harper & Associates. “I also believe the President (Donald) Trump’s threat to terminate NAFTA is not a bluff…I believe the threat is real.”

Given the uncertainty surrounding the high-stakes negotiations, USMEF is watching very closely any developments in trade access and policies impacting NAFTA, while hoping to avoid disruptions to what USMEF CEO Philip Seng called “a beautiful arrangement” for exporters of US red meat products.

“I’m reminded, in December 2003 as you know, we had this episode with BSE,” Seng recalled. “Overnight, 72 countries closed their door to US beef. At the end of January, Canada opened its doors to US beef for 30 months on-down cattle; Mexico did this in March. Those two countries, the countries that are our neighbors, our two closest friends, they opened up within three months’ time, and this was very central to the viability of the US beef industry and, to some degree, the survivability of the US beef industry at the time.”

From 1994 to 2016, the US exported $32 billion worth of beef to Mexico and Canada and $32 billion worth of pork. “Anything that would threaten our being in NAFTA, leaving NAFTA would be a mistake, and I think even threatening to leave NAFTA is basically a mistake,” he added.