Avoiding Tariffs on Mexican Imports a Relief to U.S. Meat Industry

Mexico is the largest volume destination for U.S. pork exports and the third-largest export market for U.S. beef. ( AgWeb )

The White House recently announced a plan to impose tariffs on all goods imported from Mexico unless more steps were taken to curb illegal migration at the U.S.-Mexico border. The tariffs were to begin June 10 at a rate of 5% and increase by an additional 5% each month until reaching 25% on Oct. 1. But on June 7, President Trump announced that Mexico has pledged to enhance its efforts to address border security issues. As a result, the proposed tariffs were not imposed.

This decision came as a major relief to the U.S. red meat industry, as Mexico is the largest volume destination for U.S. pork exports and the third-largest export market for U.S. beef.

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In late May, U.S. pork gained relief from a 20% retaliatory duty imposed by Mexico since mid-2018 in response to U.S. tariffs on steel and aluminum, and U.S. Meat Export Federation (USMEF) President and CEO Dan Halstrom says it is essential that U.S. pork's duty-free status is maintained. The 20% duty had a severe impact on U.S. pork exports in the second half of 2018, and through April of this year pork export value to Mexico was down nearly 30% year-over-year.

While Mexico did not retaliate against U.S. beef in the steel and aluminum dispute, Halstrom notes that the U.S. industry was very concerned that U.S. beef might be targeted if new tariffs were imposed on goods imported from Mexico.  

Halstrom adds that new tariffs would have also presented an obstacle for the U.S.-Mexico-Canada Agreement (USMCA), which still must be ratified by all three nations. USMCA preserves duty-free status for all U.S. red meat entering Mexico and Canada.

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