R-CALF USA: TPP will harm U.S. producers

In testimony presented today to the U.S. International Trade Commission (USITC), R-CALF USA urged the commission to recommend the rejection of the Trans-Pacific Partnership (TPP) free trade agreement. R-CALF USA CEO Bill Bullard testified the TPP would harm U.S. cattle and sheep producers.

“The TPP adopts the mantra of the National Cattlemen’s Beef Association, who told a federal court that ‘beef is beef, whether the cattle were born in Montana, Manitoba, or Mazatlán.’

“Under the TPP’s product-specific rules of origin, the origin of beef is wherever the animal was slaughtered. This renders the origins of cattle irrelevant. It relegates U.S. cattle producers to nothing more than an undifferentiated global supply chain for meatpackers.

“The TPP allows U.S.-based meatpackers to float live cattle from Australia, slaughter them here, and export the duty-free beef to Japan with a ‘Product of the USA’ label. This extinguishes competition between U.S. cattle producers and cattle producers from around the world. So not only will the TPP destroy competition, it also allows multinational meatpackers to usurp the good name, image and reputation of the U.S. cattle producer,” Bullard testified.

He also said that non-participating countries will benefit from the TPP at the expense of U.S. cattle producers under the flawed origin rules. He explained that meatpackers can do this now by slaughtering Mexican cattle in the U.S. and shipping the resulting beef with a ‘Product of USA’ label under the U.S.-South Korea Free Trade Agreement, even though Mexico is not a party to that agreement.

Bullard testified that the U.S. has already accumulated a $22 billion trade deficit with the 11 other TPP countries and that the TPP block represents the third-largest cattle herd in the world; it overproduces beef and its production is increasing while its consumption is decreasing.

“We will become the dumping ground for cattle, beef and lamb,” he said.

In addition, he described how the TPP discriminates against U.S. cattle and sheep producers by granting special safeguards to some cattle producers and some dairy producers, but none are provided for the U.S. cattle or sheep industries.

According to Bullard, the combination of unlimited imports and no safeguards is what caused the severe shrinkage of the U.S. commercial sheep industry.

“Since the U.S.-Australia Free Trade Agreement, more than half of our domestic lamb consumption is supplied by imported lamb. The failure to provide safeguards for sheep producers has resulted in the offshoring of our nation’s once vibrant commercial sheep industry.”

He said the cattle industry is following in the sheep industry’s footsteps with more than half a million U.S. cattle operations exiting the industry since 1980, the liquidation of the U.S. cattle herd until it was reduced to the smallest size in 70 years, and the reduced production output that is now the lowest in more than two decades, since just before NAFTA.

Bullard said that by treating the trade deficit as lost sales, it is estimated the U.S. economy experienced an output loss of about $8.7 billion and a loss of more than 97,000 jobs as a result of the $2.2 billion trade deficit increase the U.S. experienced with the TPP countries from 2013 to 2014.

Speaking about how the TPP would also weaken U.S. health and safety import standards and subject U.S. laws to review by an unaccountable foreign tribunal inaccessible to most U.S. citizens, Bullard said the TPP requires the U.S. to “unacceptably cede a wide swath of its national sovereignty.”