It is a good time to fire up the grill domestically and a bad time to export globally. Because of the trade war, around 2.5 billion pounds of meat is just sitting in U.S. cold storage.
Citing federal data, the Wall Street Journal reports that supply has surged but demand has evaporated as both China and Mexico impose tariffs on beef, pork, and poultry in retaliation to President Trump’s steel tariffs. More than likely, that means at least two things.
The meat won’t spoil. It will go on sale in domestic markets, meaning cheaper hams and steaks. This will be good for restaurants and for consumers, especially anyone already stocking up for a Labor Day barbecue.
While everyone else licks their chops though, the meat industry is counting their losses. It seems like the economy continues to improve for everyone except those in agriculture. Meat processors and poultry producers keep doing the same job they always have only to watch their profits evaporate.
Futures on lean hogs, for instance, have dropped by more than 20 cents since February. The price of those commodities will stabilize long- term. As more beef stacks up in warehouses, though, expect possible political freezer burn.
Sooner or later the agriculture electorate, those reliable Republican voters with the Trump bumper stickers on their trucks, will get tired of being held back from a booming economy by the economic paranoia of this president. When things are getting better for everyone else, they are getting left behind.
