AgDay Analysis With Cattle Expert Who Helped Officials Write NAFTA

The North American Free Trade Agreement (NAFTA) was a trade pact written back in the early 1990s. Derrell Peel, an extension livestock specialist with Oklahoma State University, is one person who aided and gave his insights when trade negotiators were writing the deal.

Peel worked in Mexico for a number of years and still continues to do so today. He gives his insights on how trade has evolved over the last 30 years.

“NAFTA from its beginnings was a big new step for the U.S. generally and certainly for the beef markets. We’ve seen a lot of growth in those markets over time,” said Peel.

Peel says how the U.S. has imported cattle from Mexico for a long time. He says with NAFTA, the U.S. began to export a lot to Mexico and in more recent years, the U.S. has imported beef and cattle from Mexico.

“We’ve seen a lot of evolution from that market overtime,” said Peel.

He says USMCA (the trade agreement between the U.S., Mexico and Canada) reaffirms those basic principles but didn’t “change things a great deal as far as beef markets.” He believes it’s a continuation of the philosophy of the first deal.

Peel says he sees China becoming a larger market just like Mexico. He says the beef market to Mexico was quite small to begin with as well.

“I do think there’s a parallel in general in terms of the way trade with China may evolve with U.S. beef,” said Peel. “It’s a very different market, it’s a new market. Once we get past political barriers, then the real work in the marketplace begins to sort of earn market share.”

He says U.S. beef product is different than what China imports from other countries.

“We need to figure out what products work, which price levels are competitive in that market. It’s going to be an ongoing process to develop that market,” said Peel.

He says China has grown so rapidly and is by far the biggest importing country in the world.

“If we can capture even a relatively small percentage of that total market, it will be a big boost to total beef exports,” says Peel.

Peel believes it will take three to five years before the U.S. will see some big boosts with U.S. beef exports to China.  

 

 

 

 

Latest News

CAB Insider: Carcass Value Shifts, a Sign of the Times

Jan. fed cattle prices are normally choppy and we’re seeing that pattern in 2021. A primary difference, compared to 2020, is that last week’s average price is $14/cwt. lower, the same discount as the 5-year average.

18 min ago
U.S. President-elect Joe Biden is sworn in as the 46th U.S. President, at the U.S. Capitol in Washington, U.S., January 20, 2021.
Ag Industry Leaders Congratulate Biden, Echo His Call for Unity

Following the inauguration of President Joe Biden, the 46th President of the United States, agriculture industry leaders congratulated Biden and Vice President Kamala Harris.

3 hours ago
Black Ink: Valued Partners

Partnerships aren’t always about a 50/50 business arrangement or who gets what tasks, sometimes they’re simply about having a vested interest in somebody else’s success.

12 min ago
One former Secretary of Agriculture thinks a Biden Administration and USDA will focus more on crafting a farm bill that includes a focus on conservation.
Why a Biden Administration May Not Buy into the Green New Deal

As President Joe Biden took office Wednesday, one former Secretary of Agriculture thinks a Biden Administration and USDA will focus more on helping craft a farm bill that focuses on conservation.

2 hours ago
As wild pigs continue to expand out of control in Canada, the risk of wild pigs moving into the U.S. is very real. This is especially true for North Dakota and Montana, but given how mobile feral swine are, the risks are far beyond that, says Ryan Brook of the University of Saskatchewan. 
Canada Fights Back Against Out-of-Control Wild Pig Population

Wild pig populations in Canada continue to expand rapidly and are completely out of control in Saskatchewan, Manitoba and Alberta. A new tool may help control this invasive species. Here's why you should take note.

1 hour ago
Broilers
Tyson Settles Anti-trust Case For $221.5 Million

Tyson Foods has agreed to pay a settlement of $221.5 million in the broiler chicken antitrust civil price-fixing lawsuit, according to filings Tuesday in federal court in Chicago.

40 min ago