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Washington Week in Review: May 16, 2019

USDA is set to announce a trade aid plan for farmers affected by retaliatory tariffs, the Senate will vote on disaster aid next week and planting progress is still slow across the nation. Spencer Chase and Phil Brasher bring you the latest in this week’s Washington Week in Review.

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Pork exports to Mexico declined in the second half of 2018 as Mexican import tariffs raised costs for importersMexico pork exports

Although total U.S. pork exports grew by 4 percent from 2017 to 2018, exports to the largest U.S. pork-trading partner, Mexico, decreased over the same period. In contrast to the trend in broiler meat exports, which showed the strongest growth in the second half of 2018, U.S. pork exports to Mexico were much stronger in the first half of the year. After Mexico imposed tariffs on most U.S. pork products in June 2018, monthly pork exports to Mexico fell below 2017 levels for the remainder of 2018. Given that the Mexican tariff rate for most pork products was 20 percent, an even larger year-over-year decline could have been expected. However, average U.S. pork export unit costs fell, compensating for the increased cost to importers from the tariffs. In the first half of 2018, U.S. pork exports to Mexico in 2018 had risen over 2017 levels, possibly because demand from Mexican importers had increased in anticipation of the impending cost increases that tariffs would produce. This chart appears in the May ERS Amber Waves article, “U.S. Exports for Most Major Meat Commodities Grew in 2018.”