A Senior Risk Management Analyst with HAMS Marketing Services says increased import tariffs imposed by the United States on its trading partners will pressure the value of North American live hogs if those partners impose retaliatory tariffs on U.S. pork.Effective August 7th the general tariff the United States charges on imports from Canada not protected by the Canada United States Mexico Agreement increased from 25 to 35 percent and additional tariffs have also been levied on other U.S. trading partners.
Paul Marchand, a Senior Risk Management Analyst with HAMS Marketing Services, says, because Canadian hog prices are determined by a formula based on the U.S. price for hogs, Canadian hog prices will be negatively affected by any retaliatory action that affects U.S. pork.
Quote-Paul Marchand-HAMS Marketing Services:
Once again, we're fairly fortunate that the new levies are applied to those goods that are not covered under the USMCA or the CUSMA as we know it in Canada, the old NAFTA, so the North American pork industry should remain fairly resilient and not a lot of changes are expected on that front.Of course, there will be some supply and demand chain disruptions if these tariffs last for any length of time and we're going to be watching that closely to find out if there's any policy lag or follow through on that front.