Audio: Competition Could Intensify in Honduras, a Key Market for U.S. Pork

January 2, 2013

Since the U.S.-Central America-Dominican Republic Free Trade Agreement (CAFTA-DR) was implemented in 2006, Honduras has blossomed into a top 10 destination for U.S. pork exports. Through October of this year, U.S. pork exports to Honduras were 6 percent ahead of last year’s pace in both volume (17,372 metric tons) and value ($40.4 million), making Honduras our ninth-largest pork market. U.S. share of the Honduran imported pork market currently stands at nearly 99 percent in terms of volume and more than 96 percent in value.

U.S. pork’s remarkable success in Honduras isn't lost on our competitors. When Canada and Honduras recently announced the signing of a free trade agreement, Canadian pork was high on the list of products expected to benefit. Through this FTA, Honduras will open a duty-free quota for Canadian pork muscle cuts. The 15 percent duty rate for out-of-quota imports from Canada will also be reduced by one percentage point per year, with unlimited volumes allowed at zero duty by Year 15 of the agreement.

Dan Halstrom, U.S. Meat Export Federation (USMEF) senior vice president for marketing and communications, addresses some of the factors that helped the U.S. industry develop Honduras into such a reliable export market, and says this success cannot be taken for granted. He adds that the new Canada-Honduras free trade agreement helps underscore the importance of CAFTA-DR, which allowed U.S. pork to establish an important foothold in this market before competitors could gain access on similar terms.

TRANSCRIPT:

Joe Schuele: In this U.S. Meat Export Federation report, we look at the remarkable success of U.S. pork exports to Honduras. Since the U.S. Central America free trade agreement (CAFTA) was implemented in 2006, Honduras has blossomed into a top10 destination for U.S. pork. This year U.S. exports will reach nearly $50 million, with the U.S. holding more than a 95% share of the Honduran imported pork market. When Canada and Honduras recently announced the signing of a free trade agreement, Canadian pork was high on the list of products expected to benefit, so the U.S. industry can expect the competition to intensify in Honduras in future years. Dan Halstrom, USMEF Senior Vice president of marketing and communications, address some of the factors that have helped the U.S. pork industry develop Honduras into such a reliable export market.

Dan Halstrom: It’s our most successful pork market in Central American and since CAFTA kicked in, in 2006, we’ve seen dramatic growth to where this year we are going to be close to a $50 million market for U.S. pork. It’s primarily pork muscle meats, it’s a vast array of cuts, everything from further processed items like hams and picnics to retail cuts like loins and butts and ribs.

Joe Schuele: Halstrom says the new Canada Honduras trade agreement helps underscore the importance of CAFTA which gave U.S. pork an important foot hold in this market before competitors could gain access on similar terms.

Dan Halstrom: Without a doubt, yes, this is living proof that CAFTA, timing wise, put us at an advantage. We’ve got a head start but we need to continue to be aggressive because while we have a large (almost complete) share of that imported pork market, we can’t sit back because others are going to try and take that share, because this is a market that is seeing generic population growth and is seeing a significant increase in disposable income that is available to spend on food. There is a growing demand there and we have to be front and center to capitalize on that.

Joe Schuele: For more on this and other trade issues please visit USMEF.org. For the U.S. Meat Export Federation, I’m Joe Schuele.

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The U.S. Meat Export Federation (www.USMEF.org) is the trade association responsible for developing international markets for the U.S. red meat industry. It is funded by USDA; the beef, pork, lamb, corn and soybean checkoff programs, as well as its members representing nine industry sectors: beef/veal producing & feeding, pork producing & feeding, lamb producing & feeding, packing & processing, purveying & trading, oilseeds producing, feedgrains producing, farm organizations and supply & service organizations.

USMEF complies with all equal opportunity, non-discrimination and affirmative action measures applicable to it by contract, government rule or regulation or as otherwise provided by law.