U.S. Faces Meat Shortages as Pork, Other Protein Exports to China Soar

A butcher waits for customers at his stall at a market in Beijing on July 10, 2019. - Factory prices in China were unchanged in June from a year ago, data showed on July 10, reviving the prospect of deflation as the US trade war hits the crucial manufacturing sector. …

The coronavirus outbreak has impacted the U.S. food supply chain, including the disease infecting workers at meat processing plants, causing operations to shut down and resulting in slaughtering of livestock that can’t be processed and shipped to retailers.

Some restaurant chains are also facing shortages, including Wendy’s, which announced it had run out of beef for burgers.

But at the same time the U.S. is facing meat and protein shortages, pork and other exports to China have soared.

Reuters published an analysis on the parallel phenomenon:

Meatpackers and livestock producers in the United States have spent at least a year adjusting to the surge in business to China, which has faced a severe pork shortage in the wake of its battle against African swine fever.

But now, as the United States is on the brink of its own meat crisis due to the coronavirus pandemic, American pork supplies are being shipped off to China at a breakneck pace, creating the perfect recipe for additional U.S.-China tensions.

For some American consumers, the optics of this situation might be poor given how the virus originated in China late last year. But record U.S. meat exports to China have been the plan all along, to satisfy both China’s needs and to lift U.S. business.

The Chinese connection is tied to trade deals with the United States, one of the main pillars of the Trump administration agenda, and agreements that pre-date the coronavirus outbreak, the Associated Press (AP) reported:

The two governments have raised tariffs on billions of dollars of each other’s imports since 2018 in a fight over Beijing’s trade surplus and technology ambitions. Under the January agreement, Washington agreed to reduce some tariff hikes and postpone others in exchange for what Trump said was a Chinese commitment to buy American farm goods and other exports worth $200 billion. Beijing has resumed purchases of American soybeans but has yet to confirm the size of any commitment.

On Sunday, Trump told Fox News, “If they don’t buy, we’ll terminate the deal. Very simple.”

AP reported that Chinese and U.S. officials spoke by phone on Friday, according to the Chinese news outlet Xinhua.

Chief Chinese envoy, Vice Premier Liu He, U.S. Trade Representative Robert Lighthizer, and Treasury Secretary Steven Mnuchin agreed to “create a favorable atmosphere and conditions” for implementing the “phase one” agreement signed in January. The Reuters analysis said:

The U.S. meat shortage and the Phase 1 goals of increasing exports to China seem to be opposing forces, raising the question of whether sales and shipments will or should be limited. Some restrictions would not be surprising given U.S. President Donald Trump’s more combative tone in his recent comments on trade with China. Trump also last week ordered meat-processing plants to stay open to protect U.S. meat supply, but this has sparked some backlash from unions and lawmakers over the safety of workers, and it is not clear if the mandate will have the desired effect on production.

The Reuters piece said the preliminary U.S. export data for April “suggests that pork exports to China were comparable with March while beef shipments were likely higher” and that most of the sales and exports to China accumulated before the U.S. meat shortage spiked.

“The value of all U.S. pork, beef, poultry and products exported to China in the first three months of 2020 totaled $781 million,” the Reuters analysis reported.

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