New trade deal could affect global pork trade
The new Trans-Pacific Partnership trade deal, signed on Monday, could have an impact on the global pork trade.
On Monday, 12 countries around the Pacific Rim reached agreement on a new trade deal, the Trans-Pacific Partnership (TPP). The deal covers 40% of the world’s economy, with the USA, Canada, Mexico, Japan, Australia and New Zealand among the countries involved. Although the full details are yet to be published, it is expected that many tariffs on agricultural products, including meat, will be reduced or eliminated, probably over a transitional period of up to 10 years. The TPP still needs to be ratified by the individual countries, a process which is likely to take several months. In particular, detailed scrutiny can be expected in the US, where there is a widespread belief that previous trade agreements have cost jobs and the deal is opposed by some presidential candidates from both parties.
In terms of pork, the main importers among TPP signatories are Japan, Australia and Mexico. The US, Canada and Chile are all pork exporters. While trade between Mexico, Canada and the US is already governed by the earlier NAFTA agreement, the new deal could give these exporters an advantage in Japan and Australia. Outside the EU, Japan is the world’s largest pork importer. Last year, the US and Canada supplied around half of Japanese pork imports, a share which has fallen from over 60% in 2012 as shipments from the EU have risen. Mexico and Chile also account for over 10% of Japanese imports between them. The TPP may make it harder for EU exporters to compete on this important market and could see its market share fall again.
Although Australia is a smaller market, importing just over 140,000 tonnes last year, compared to Japan’s 830,000 tonnes, it too has seen the EU making inroads in recent years. The share of imports from the US and Canada has again fallen from over 60% in 2012 to around half now.