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Pork and Dairy Producers Watchful of the Trade Conflict
USAgNet - 06/22/2018

If the world tariff conflict continues to escalate, Ohio's pork and dairy producers could suffer from the fallout.

Exports of soybeans, which have already been targeted with tariffs, are critical to Ohio, but pork and dairy products play a role in the state's economy as well.

Earlier this month, Mexican authorities set tariffs on U.S. imports including a 20 percent tariff on pork and 25 percent on some cheese products. China too has targeted pork imports with a tariff of 25 percent.

Any cut in demand for pork will likely decrease demand for corn and soybeans because both crops are used to feed pigs, said Ian Sheldon, an agricultural economist, who serves as the Andersons Chair in Agricultural Marketing, Trade and Policy in the College of Food, Agricultural, and Environmental Sciences at The Ohio State University (CFAES.)

"That's why the Mexican government did it," Sheldon said. "A pork tariff gets at both the hog-producing and animal-feed-producing sectors in the United States."

It's unclear how much of an impact pork tariffs could have on Ohio's pork producers because most Ohio farmers that raise hogs for slaughter contract with multinational companies that own the pigs, but pay farmers to house and care for them, said Ben Brown, manager of the farm management program in CFAES.

With lower prices for corn and soybean feed, an Ohio pork producer may actually benefit from paying less to feed the hogs but at the same time could be hindered by a drop in the demand for pork, said Brown, who along with Sheldon are in the Department of Agricultural, Environmental, and Development Economics within CFAES.


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