Thursday, March 23, 2017

Farm lobbies urge Trump to avoid trade war with Mexico that could cost U.S. $3 billion a year

Farm interests that helped put President Trump in the White House are asking him "to avoid a trade dispute with Mexico, fearing retaliatory tariffs that could hit over $3 billion in U.S. exports," Jason Lange and Alexandra Alper report for Reuters. John Weber, president of the National Pork Producers Council, said pork producers "contacted Trump's transition team soon after the Nov. 8 election to stress that tariff-free access to Mexico has made it their top export market by volume."

"The council has sent the administration multiple letters, including one signed in January by 133 agricultural organizations, and is arranging for several hog farmers to fly to Washington next month to talk to officials," Reuters reports. "Trump has accused Mexico of destroying U.S. jobs and has vowed to leave the 1994 North American Free Trade Agreement with Canada and Mexico if he cannot renegotiate better terms with Mexico."

"In December, after fears of a trade dispute fueled a deep peso slump, Mexico started mapping out U.S. states that are most reliant on its market, replicating the strategy it used in the trucking dispute, said two senior Mexican officials," reports Reuters. "Mexican officials also prepared briefs, seen by Reuters, on Mexico's own risks in a dispute, including losing much of its cost advantage in building cars, such as the Ford Fusion made in Hermosillo, Mexico."

Weber said he fears Mexico "could revive the list of mostly agricultural products it successfully used to push Washington into letting Mexican truckers on U.S. highways in 2011," reports Reuters. "Pork products topped that list and, if revived, the tariffs would apply to over $800 million of annual pork exports, according to data compiled by IHS Markit's Global Trade Atlas." Weber told Reuters, "We'll be the first to take the hit."

No comments: