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What does Trump’s annulment of the TPP mean for the meat and dairy industries?

Posted: 24 January 2017 | Roy Manuell, Digital Editor | No comments yet

New Food presents reaction from the meat and dairy industries to President Donald Trump’s tearing up of the TPP agreement…

One of President Trump’s defining policies on the campaign trail was the Trans-Pacific Partnership (TPP) and he has certainly kept to his word.  

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One of his first acts in office on his first day was to remove the deal.

As explained by BBC News:

“The pact aimed to deepen economic ties between twelve countries that border the Pacific Ocean, slashing tariffs and fostering trade to boost growth. Members had also hoped to foster a closer relationship on economic policies and regulation.”

The TPP is comprised of: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States of America and Vietnam and they (excluding the US) represent roughly 13.5% of the global economy, according to the World Bank.

Many critics including the President saw the deal championed by Barack Obama as having a significantly negative effect on the US economy and detrimental to American citizens seeking jobs.

Furthermore. the TPP is as good as dead without US support; it is highly unlikely that the pact will hold now that the world’s richest economy has pulled out of the deal. In line with this, the Japanese Prime Minister Shinzo Abe has said a TPP without the US – and its market of 250 million consumers – would be “meaningless”.

Not only might this affect these nations and their trading relationships within the Pacific Rim, the US meat and dairy industry is likely see a significant impact and it is upon these markets that this article will focus. 

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The meat industry’s reaction

The meat industry is worried after the move and it has reason to be unless alternative deals are renegotiated.

The export value of the meat industry in the US is hugely significant and valuable. For example, in 2015, the US export of just pork to Japan, one of the twelve nations, was valued at US$1.586 billion by the US Meat Export Federation.

As a result, the North American Meat Institute (NAMI) has called on President Donald Trump to urgently consider a bilateral trade deal with the nations in the TPP after he withdrew from the partnership.

Janet Riley, the organisation’s Senior Vice-President stated that: 

“We value our trade relationships with Asia and we look forward to discussing paths to access these markets so we may expand our industry.”

The US is the world’s biggest exporter of meat, with an output of US$2.7 billion (12.6% of the global total) of total fresh beef exports alone. 

It is further estimated that for every US$1 billion of agricultural exports, 8,000 new jobs were created in the US. While it is unclear how important the TPP is for these economic and domestic benefits to the US, what is clear that international trade is of great value to the American agricultural industry. 

The dairy industry’s reaction

Meanwhile, leading members of the dairy industry have been a lot more pessimistic with leaders of the National Milk Producers Federation (NMPF) and the US Dairy Export Council (USDEC) voicing worries following President’s Trump’s executive order to remove the TPP.

A retreat from TPP “must not lead to a retreat from economic engagement with growing Asian markets for American dairy products,” said NMPF President and CEO Jim Mulhern.

“While we recognise that TPP as it now stands has no path forward, we urge the Trump Administration to look for future opportunities to increase our dairy exports in Asia and around the world. Our competitors have been successfully negotiating trade agreements over the past several years. This puts the U.S. agriculture sector at a competitive disadvantage if we don’t pursue our own initiatives,” he said.

Elsewhere Matt McKnight, Acting Chief of Staff for USDEC asserted that “the U.S. dairy sector exports 15 percent of its milk production, or one day’s worth of milk production out of each week. In 2015, those exports were worth over $5 billion, and helped generate more than 120,000 jobs in dairy farming, manufacturing and related sectors.”

He said the groups will continue to press lawmakers on the important link between export sales and dairy job growth in the United States.

While the future looks uncertain, what we can be sure of is that both the dairy and meat industries in their current form in the US benefit greatly from trading with Asian nations and the other members of the TPP.

As part of our ‘Feeding Asia’ feature, New Food has touched upon the changing consumer habits of the newly-developing Asian nations such as those among the twelve nations represented in the TPP. Many of these nations such as Malaysia to use one such example, is seeing a significantly growing demand for meat and dairy products and many worry that Asia is becoming less and less self-sufficient as populations grow and arable land space decreases.  

As both the dairy and meat industries react we can only wait and see as to when or even whether bilateral deals are formed with the likes of Japan, Australia and the other nations who signed the as-good-as-dead pact.  

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