Posted on 07/04/2018 11:23:56 AM PDT by Poison Pill
U.S. pork producers are about to be bitten by a second batch of hefty retaliatory tariffs from China and Mexico — and that has some large producers predicting they could lose big money and be forced to invest overseas.
Executives say the pork industry has been expanding in recent years, in part on the expectation of export opportunities that would continue to support growth. However, the threat of a trade war is adding uncertainty and driving fear.
"We put a halt on all investment, not just because we will be losing money, but because we don't know if growing in the U.S. is the right move if we won't be an exporting country," said Ken Maschhoff, chairman of Maschhoff Family Foods and co-owner of the nation's largest family-owned pork producer.
Maschhoff said the farm industry has been "asked to be good patriots. We have been. But I don't want to be the patriot who dies at the end of the war. If we go out of business, it's tough to look at my kids and the 550 farm families that look us into the eye and our 1,400 employees."
Mexico imposed a 10 percent tariff on chilled and frozen pork muscle cuts effective June 5, and that import tax is set to double to 20 percent on Thursday.
China, meantime, is scheduled to start collecting an additional 25 percent import duty Friday on American pork products as it targets $34 billion worth of U.S. goods in response to President Donald Trump's action against Beijing for alleged intellectual property theft.
China also is set to add tariffs this week on U.S. soybeans, corn, wheat, cotton, whiskey and dairy, as well as U.S. autos. Nearly $20 billion in U.S. agricultural exports went to China last year.
(Excerpt) Read more at cnbc.com ...
It also assumes that pork farmers are too dimwitted to hedge or diversify.
Hard to hedge against the world's two largest economies trying to knock your block off. Like trying to hedge against a firing squad.
Seriously? The world’s two largest economies keep hog farmers from selling contracts on the Chicago Mercantile Exchange? They force some farmers to raise only hogs to the exclusion of, say, cereal crops or other livestock?
Seriously? The world’s two largest economies keep hog farmers from selling contracts on the Chicago Mercantile Exchange? They force some farmers to raise only hogs to the exclusion of, say, cereal crops or other livestock?
We could always stand some reduced prices on (over)priced pork products here in the US.
They want to lower prices I’ll buy more pork.
“I read somewhere recently that Chinese pork dumplings are the largest consumers of boneless inverted pork rectums”
My hard scrabble farmer Uncle used to say that with pigs, everything is used but the squeal.
Also (slightly off track), America is/was the largest exporter of chicken feet. China beong the largest consumer.
But the question I have is:
If China has purchased pork production facilities in the US such a Smithfield ham, are those companies owned by China subject to tariffs when they export pork products back to China?
I'm not following you- Tariffs are paid by those IMPORTING goods. If Chinese markets continue to import pork - THEY pay the tariffs. If other examples prove to hold out - higher tariffs tend to slow importation of that product - and raises the price to THEIR consumers, both from the direct cost of the tariff being passed on, but also the higher price of that commodity due to there being less imported). I am about as "anti-tax" as anyone. Tariffs are a form of taxation. BUT - #1 - Tariffs were the original form of funding for our Federal Government. #2 - If one is going to use Tariffs as a tool to insure that tariffs are not unfairly practiced (particularly in light of trade "deals" that were suppose to "even the playing field" - then go for it. Why should we give China a free ride? They ship quantities of goods to the US in volume most Americans are not even capable of comprehending. They do this after stealing intellectual and design property. They do this while paying their workers near-nothing. They do this while undermining our interests around the world. They do with while also engaging in electronic/technological warfare against us. They do this while also enjoying cut-rate shipping via our own USPS (How can a Chinese company ship a $1 item around the globe to be delivered by the USPS - when the item itself costs nearly $1 to manufacture?) At the same time, China charges tariffs on everything we ship to them. Tariffs that are significantly higher than the tariffs we (sometimes) charge them. All while having promised to "open" their markets. Sorry - but tariffs are part of doing business internationally.
That's a euphemistic way of saying we are more automated. For political reasons it is always phrased as a compliment to the remaining Americans not yet automated out of a job.
Not euphemistic. It is the terminology used by economists. And that is correct. America is more efficient than anyone else with closest competition from S Korea.
Automation, in a rational freemarket system leads to more jobs at all levels. That has been true since the beginning or the Industrial Revolution.
Past performance is no guarantee of future results. A percentage of Americans are already the equivalent of human pets, and that percentage is growing over time.
Where did you get all your economic clichés?
Henry Hazlitt, Ludwig Von Mises, Adam Smith,and some etcs. I don’t put a lot of stock in Krugman or Keynes, though I have read them too. K. Marx would have agreed with you, of course.
They won't continue to import at the same levels. That's the point. They will switch import partners, use alternate products, produce internally, or go without. Supplies of pork back up here, the price goes down and the hogs farmer's revenue falls off a cliff. That's what they did with soybeans. They now buy somewhere else.
Tariffs were the original form of funding for our Federal Government.
Yes, back when we had no income tax and the cost to run the country was microscopic. If the country wants to repeal the income tax, can the IRS, cut the government in half and fund the remaining operations with a blanket 2% tariff on all imports, sign me up!
So the farmers cut back some on soybean production (still grow a lot) and increased the more profitable corn production. That's how farming works. You grow what is selling - you fill where there is a demand. That is, of course, unless the government further manipulates the market by paying subsidies to plant/grow what isn't needed - or to not plant at all (as has happened in the past).
“The Good Patriots” who have received $billions in taxpayer-funded payoffs to plant what isn’t needed (low demand), or benefitted from subsidized by law products (corn for ethanol, as an example).
Most citizens have no idea just how deep the government is in farms - from the tax write-off of nearly all costs of production to the massive payoffs to farms (especially huge corporate farms) that is basically “free money”... The government has crushed small farmers by their payoffs and tax schemes - I get really tired of hearing the “poor farmer” mantra when most I know drive new vehicles all the time, live in NICE homes, all while crying how poor and broke they are - and how farming doesn’t make any money.
Get the government out and let the market do its thing.
As to tariffs - just do what those other nations do. If they don’t like it - they can lower their tariffs first.
“Palestine”??? Where’s that? You mean muslim-occupied Israel?
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