Nick Giordano
is the
Vice President and Counsel for Global Government Affairs at the National Pork Producers Council
, and last week he sat down with us for GBD’s first Zoom interview with a trade expert. We hope to do many more. This first discussion was exceptionally rich, however, and we are bound to return to it in these pages two or three more times. But you don’t have to wait. Click
here
or in the link below and watch the full interview now.
As Mr. Giordano explained, 2018 and 2019 were not good years for American pork producers. It wasn’t just that they were caught up in the trade conflicts of those years, they were, as Mr. Giordano put it, “at the tip of the trade retaliation spear.” That meant that U.S. pork exports faced retaliatory tariffs in key markets from China to Mexico. And then in 2020, the novel coronavirus, COVID-19, hit, causing disruptions in the U.S. meat processing plants, including those that process U.S. pork. In response,
President Trump
issued an executive order on April 28, 2020, which invoked the provisions of the Defense Production Act for U.S. for food supply chain resources. In the language of the Executive Order:
Under the delegation of authority provided in this order, the Secretary of Agriculture shall take all appropriate action under that section to ensure that meat and poultry processors continue operations consistent with the guidance for their operations jointly issued by the CDC and OSHA.
Mr. Giordano explained why that action was so important to his industry. Before the April 28 order, U.S. pork processing facilities were operating at only 60 percent capacity. That in turn meant that the supply of hogs was backing up on the farms. Normally, pig farmers raise their hogs and, when they’re ready, they ship them off to be processed. The hog farmers themselves are not in the business of killing, euthanizing, their own pigs, and neither can they simply let them just get bigger. As Mr. Giordano explained:
If the animals get too big, it’s an on-farm worker-safety issue. And it’s also an in-plant worker-safety issue. Also, a lot of these plants can’t take hogs that get too heavy. The equipment just won’t take the hog.
Things have improved since April, and the processing facilities are now operating at 90 percent capacity. Even so, there is still a huge backlog of animals that farmers have to euthanize or, where possible, get them into the food supply through, for example, donations to food banks. Those are imperfect solutions to say the least, as they leave far too many farmers on the brink of bankruptcy. That is why t
he National Pork Producers Council is urging the Senate to follow the House lead with legislation that will compensate farmers for losses
of those animals that could not be sold.
Trade and the Domestic Food Supply
. If supplies of U.S. pork have become more limited, as in some senses they have, does it make sense for America to try to hold on to – or even expand – its export markets? We put that question to Nick Giordano. His answer was clear. There is already a great deal of uncertainty surrounding U.S. trade. The result of any further threat to U.S. pork exports would only send a signal to more hog farmers that it is time to get out of the business. And if you are concerned about maintaining America’s safe, secure, and affordable food supply, that would be exactly the wrong signal. Here is a more of what he said on that question:
The crisis has not been on the supermarket shelves. The crisis is on the farm
. But if we don’t get a meaningful lifeline and a lot of hog farmers go under, then, it’s a very valid question: what’s going to happen to consumer prices? Necessarily, if there is less production long term, we’re going to export less. We’re going to have less for U.S. customers.
But a lot of the product mix is different too. There are some cuts that overlap, but we export a lot of the internal organs of the animal. There is really very limited market for that in the United States, but it is a premium in China, for example. So, there is not a one-for-one substitution.
The reality is, if exports were cut off, it would send a signal back up the chain to cut production. If that happened, you’re not helping hog farmers. They’re in an unprecedented nightmare, and that would, just really, send a signal to cut back and to take more hog farmers out. That is not what we want to do. …
When talking up trade deals on the Hill, I’ve always said the pork industry is the poster child for expanded trade, and we have been. And
exhibit A for a healthy industry is exports.
And, you know,
we’re not exporting jobs out of the United States; we’re exporting pork.
And we’re really good at it. We’re really proud of what we do, and we’re No. 1 in the world.
