analysis

World Trade Month: 4 key deals over the past 12 months

By Ashley Williams contact

- Last updated on GMT

World Trade Month aims to educate the public on the importance of global trade
World Trade Month aims to educate the public on the importance of global trade
The start of May marks the beginning of World Trade Month and it has certainly been a busy year for international trading across the meat industry.

World Trade Month celebrates companies that export goods and services around the world and is also an opportunity to educate the public on the importance of global trade.

Exports and imports open up opportunities for countries and, without them, there would be a lack of development and growth in economies, as not all nations have the resources and skills required to produce certain goods.

Evidently, no trade deal is a walk in the park, but it is a crucial part of the meat industry. There are an abundance of complications when it comes to agreements as countries impose trade barriers, such as tariffs and import quotas, in order to protect domestic industries.

With many uncertainties for the meat industry, countries from the across the world are preparing themselves for the challenges ahead.

GlobalMeatNews​ highlights four prominent trade deals that have occurred over the past year.

American flag

US ins and outs

The US does not make things simple when it comes to trade deals.

Trade wars with the likes of China and Russia have significantly affected relations with key markets as President Donald Trump imposes international sanctions and introduces tariffs, making agreements difficult to finalise.

But there is light at the end of the tunnel for the country’s pork sector as it breaks through into the South American region.

Final details for US pork to enter Argentina emerged last month after a 26-year absence, with US secretary of agriculture Sonny Perdue confident that US pork would thrive once again.

US pork was also granted approval by Argentina’s neighbour Paraguay.

Interestingly, following the Paraguay agreement, the US National Pork Producer Council chairman Jim Heimerl came up with a deflated response regarding the US’ current trading climate, saying that Paraguay would not be a huge market for US pork, but needed “all the markets it could get​” – a sign that the US’ confidence on trade deals remains extremely low.

China trade deal

China the key market for traders

After a reluctant period, it seems as though China is finally easing open its markets to international trade deals.

The Asian market was identified as key by respondents to GlobalMeatNews’​ survey​, with 58% of meat professionals aiming to target new trade areas.

Ireland became the first EU market to export beef into China recently, following prolonged talks with Chinese authorities, while Thai poultry was also welcomed back into the Chinese market after a 14-year ban. China banned imports of Thai chicken in 2004 to prevent further outbreaks of bird flu across the region, but these were deemed safe after Japan and South Korea allowed Thai exporters to return in 2017.

Will China continue to be so welcoming with trading through 2018? Only time will tell.

Upcoming deals

Upcoming deals

With trade dominating the international meat industry during 2017, there are certainly a few deals to watch out for.

There have been long-running negotiations regarding the EU/Mercosur deal. Initial talks outlined that Mercosur would distribute 99,000 tonnes (t) of beef to the EU at a lower tariff rate, but the South American trade bloc wants to increase this amount to 150,000t, causing friction between the two markets.

Despite Brazil being continually accused of failing to meet EU standards, particularly by the Irish Farmers’ Association, talks have reignited about the deal after stalling last year.

During the beginning of 2018, EU and Mercosur representatives met in Brussels, Belgium, to try and resolve complications with the deal – an indication that the EU is beginning to regain trust for Brazilian beef.

The Trans-Pacific Partnership (TPP) is also a key topic of debate that has caused some complications. The TPP, which was signed in February 2016 by a host of countries including Australia, the US and Singapore, has yet to be ratified, due to the US continually disrupting progress.

Efforts have been made to revive the agreement without US participation, but core details still need to be finalised if a deal is to be agreed.

Middle Eastern demand for UK lamb

Middle Eastern demand for UK lamb

The Middle East is expected to be a big market for lamb from the UK as Saudi Arabia lifted its ban on the meat following a detailed negotiating process. As a result, lamb exports to Saudi Arabia are expected to generate around £25 million over a five-year period.

With Brexit on the horizon, this has brought a positive reaction from the UK sheep industry, which is hoping to make the most of the opportunity.

Kuwait also reopened the market for UK lamb and announced it had lifted its ban, as part of a five-year deal estimated at £15m. The ban was implemented by Kuwait following concerns over the degenerative disease scrapie, which affects the nervous system in sheep and goats.

UK lamb exports to both European and non-EU countries performed well in 2017, with total volumes up 14% and value at more than £384m. Non-EU volumes grew to 5,400t – up by two-thirds on the previous year.

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