World Trade Organization (WTO) Doha Round

IMPORTANCE

With 96 percent of the world’s population residing outside of the United States, it is essential that U.S. pork

producers continue to gain access to more of these potential customers. A successful World Trade Organization

Doha Development Round had the ability to increase the world economy by $300 billion over the next decade.

New and expanded market access through trade agreements have been the most important catalysts for increased

U.S. pork exports. Since the implementation of the North American Free Trade Agreement in 1994 and the Uruguay

Round Agreement in 1995, U.S. exports of pork and pork products have increased by more than 389 percent in

volume terms and more than 361 percent in value terms. While pork exports have exploded in recent years, future

growth is dependent on further trade liberalization. The average global tariff on pork is still a staggering 77 percent.

 

BACKGROUND

The WTO Doha Round began in 2001 and is NPPC’s top trade priority. Unfortunately, the proposals put forward by

the European Union and the G-20, if implemented, will not bring about significant increases in U.S. pork exports.

For pork producers to get increased market access from the Doha Round, the U.S. must engage in bilateral

negotiations with the EU and Japan. Currently, the U.S. supplies far less than 1 percent of EU pork consumption,

and while Japan is the biggest value market in the world for U.S. pork exports, there is still enormous potential

for growth. 

 

NPPC POSITION

NPPC will strongly support a Doha agreement if it will generate significant increases in U.S. pork exports.  

 

NPPC CONTACT

Nicholas Giordano, International Trade Counsel, (202)347-3600, giordann@nppc.org.

 

Last Updated: February 1, 2007

U.S. Pork Producers Support the Panama Trade Promotion Agreement

U.S. Pork Producers Support the Peru FTA

·        The free trade agreement negotiated between the United States and Peru, when implemented, will create important new opportunities for U.S. pork producers. U.S. pork exports to Peru currently are restricted by duties as high as 25 percent.  However, the Peru Trade Promotion Agreement (PTPA), if implemented, will establish immediate tariff reductions on all pork products.  Some pork products will receive unlimited duty free access upon implementation of the agreement.  Tariffs on most pork items will be phased out within five years.  All pork tariffs will be completely phased out in ten years.

 

·        In addition to the favorable market access provisions, significant sanitary and technical issues have been resolved.  By a letter dated January 5, 2006 the Peruvian government confirmed that it shall recognize the meat inspection system of the United States as equivalent to its own meat inspection system.  The aggressive market access provisions coupled with the agreement on equivalence make the Peru agreement a state of the art agreement for pork producers to which all future FTAs will be compared.

  

·        Live hog prices are positively impacted by the introduction of new export markets.  Recent price strength in U.S. pork markets is directly related to increased U.S. pork exports.  Mexico continues to be a strong and growing export market for U.S. pork.  The same competitive advantage that has resulted in expanded U.S. pork exports to Mexico will also facilitate an expansion of U.S. pork exports to 28 million new consumers in Peru.

 

·        The most important impact of PTPA is the income growth that accompanies free trade. Most consumers in Peru currently are at an income level that does not allow them to consume meat on a regular basis. Prosperity created by a free trade agreement will create millions of new customers for U.S. meat and other agricultural products.

 

·        According to Iowa State University economist Dermot Hayes, PTPA, when fully implemented, will cause hog prices to be 83 cents higher than would otherwise have been the case.  That means that the profits of the average U.S. pork producer will expand by 7 percent.

 

·        Congressional action is needed!  This agreement provides significant benefits for U.S. pork producers, which cannot be realized until the agreement is implemented.