Dr. Dermot Hayes, a Professor and Pioneer Chair and Agribusiness with Iowa State University talked Trump Trade at the annual meeting of the Manitoba Pork Council in Winnipeg, MB last month and how that is affecting pork.

“The US has suddenly become much more concerned about a trade deficit and ways to impose adjustments to corporate taxes that would stimulate US exports and reduce US imports,” said Dr. Hayes. “That may or may not be a good thing, but it’s causing a lot of concern about our friends in Mexico, in particular. They’re viewing it as a start of a trade war, and our customers in Asia who are very concerned about the security of their food supply and the possibility that a trade war might disrupt it.”

Hayes said it’s too soon to say what the international reaction to these changes is and what the possible significance is of that.

“It’s too soon to say what the reaction is because policy changes take some time. My observation is that the protectionists all over the world are winning now because instead of relying on food from North America they’d rather produce it themselves so they don’t have to be exposed to arbitrary changes in US export rules or import rules or the potential trade wars or even embargoes,” he said. “We began to integrate the whole industry, more sows in the prairie provinces where disease pressures are less. Those sows were producing animals that were then fed in the upper Midwest. In some cases the hams from those animals went to Mexico where it was deboned and exported out of North America. That worked for a while but I think we shocked the confidence of the system when we imposed Country of Origin Labelling on Canada and Mexico. I think that was a protectionist measure. It was not good and I’m not at all proud of it. That stimulated more finishing in the prairie provinces of pigs that would otherwise have come down to us.”

Dr. Hayes said when it comes to the others thinking of the US as a reliable food supplier, people use that phrase a lot, reliable and consistent. However, when you tell people that you build a wall or we’re going to charge you, we’re going to impose a 20 per cent duty and those people are naturally proud people, or have decided they’re not going to build that wall and they’re not going to pay for it, they’re getting ready for a trade war.

“Food is so sacred and so important to people you cause immense damage if you threaten the security of that. It moves people off the concept of importing cheap food from North America towards producing it themselves,” he said. Dr. Hayes said the potential trade opportunities with China are immense, 1.4 billion people to whom pork is the meat of choice, they’re getting rich at an incredible rate and they’re moving away from cereals to high quality animal protein. The economics are there.

“It would support both expansion in the US and in Canada, but we’ve got to allow that to happen and not stimulate protectionism among China’s policymakers,” he said.

If they do not change their policy then we’re looking at opportunity for continued profitable expansion in both Manitoba and in the US. •

— By Harry Siemens