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Bethan Wilkins

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AHDB Pork Market Intelligence

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US to impose higher tariffs on EU pig meat products

Home \ Prices & Stats \ News \ 2019 \ October \ US to impose higher tariffs on EU pig meat products

The World Trade Organisation (WTO) have announced that the United States would be allowed to apply up to $7.5 billion of retaliatory tariffs a year on products imported from the EU. This is as a result of the Airbus-Boeing dispute.

As such, the United States has published a final list of EU products affected by the additional duties, which will be implemented from the 18 October.

The final list of EU products includes a selection of processed pork codes and frozen pork, although the largest impacts will be on frozen pork. The additional duties have been set at 25% ad valorum i.e 25% of the value of that particular product.

However it is important to note, that the tariffs applied vary between member states

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What will this mean for the UK?

In terms of affected products, UK pig meat exports will be subject to all the retaliatory tariffs. Historically, the UK has not exported processed pig meat products to the US. Therefore, the tariffs on these products are unlikely to affect the UK.

Exports of frozen pork are likely to be the most impacted by the implementation of the tariffs. Last year, the UK exported 11,200 tonnes of frozen pork to the US, around 11% of the UK’s total frozen pork exports. All of this is product that would be subject to the tariffs.

Interestingly, the average price of UK exports of frozen pork to the US (£3,402/tonne) is considerably higher than for the rest of the world (£1,232/tonne). This suggests that the US is importing a more premium product. Some American food service groups are capitalising on the British brand, marketing product as outdoor reared and hormone free. As such, it is unclear what impact the tariffs will have on exports to the US, particularly as these particular end consumers may be driven by quality rather than price.

So why are these tariffs being applied?

Earlier this year, the WTO ruled the EU gave illegal subsidies to the airplane manufacturer Airbus. This gave the company an unfair advantage over others, including the US company Boeing. As a result, the WTO has allowed the US to impose additional tariffs on products imported from the EU, to recover the money it has estimated to have lost. The tariffs encompass a wide range of products.

The full list of affected products can be found here.

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