R-CALF USA has just released its 2011 report titled “U.S. Trade Balance in the Trade of Live Cattle, Beef, Beef Variety Meats, and Processed Beef: Decades of Neglect,” and the picture it paints is that the promises made by free trade idealists have not materialized for cattle producers, and the U.S. continues to accumulate huge trade deficits in beef and cattle under the North American Free Trade Agreement (NAFTA), the Central American Free Trade Agreement (CAFTA), as well as the U.S.-Australia Free Trade Agreement.
In fact, the report shows that over the past 22 years, the 17 countries with which the U.S. has free trade agreements (FTAs) has resulted in the U.S. realizing a cumulative trade deficit of an incredible $41 billion. The report was prepared by R-CALF USA using data compiled by the U.S. Department of Agriculture’s (USDA’s) Foreign Agricultural Service (FAS) and USDA’s Economic Research Service (ERS).
In 1985, 10 percent of all available beef in the U.S. market was imported into the U.S., and as of 2010, it was 14 percent. Currently, 17 countries participate in FTAs with the United States: Australia, Bahrain, Canada, Chile, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Israel, Jordan, Mexico, Morocco, Nicaragua, Oman, Peru and Singapore.
Over the past 15 years, the U.S. cattle herd has shrunk down to the lowest levels since the 1950s causing domestic beef production (beef produced exclusively from cattle born, raised and slaughtered in the U.S.) to fall below 1999-2000 levels.
“This is disturbing because we have been sending more female cattle to slaughter while we’ve been liquidating our herd since 1996, and this additional female slaughter has helped to prevent our domestic production from sinking to historical lows,” said R-CALF USA Bill Bullard. “The U.S. cattle industry has not been able to keep pace with the growth in domestic beef consumption, and it is imported beef and imported cattle that continue to make up the shortfall.”
Bullard said imported cattle and beef have played a significant role in preventing the U.S. cattle herd from expanding as these imports effectively suppress domestic beef production. The increases in U.S. beef exports experienced recently are only able to minimize the negative effect that decades of annual beef and cattle trade deficits have had on the economic well-being of the U.S. cattle industry. The report shows that the cumulative trade deficit over the past 22 years in cattle and beef between the U.S. and the rest of the world is now $20 billion.