International Markets, Trade Agreements, Trends Kent Swisher, Vice President, International Programs

2019 IPPE, Atlanta, GeorgiaFriday, February 15, 2019

Overview

• Introduction • Supply/Demand• Trade War and Rendered Products• Trends

Staff

• German Davalos, Director Latin America, 15 years with NRA – Lucy Cano 15 years

• Peng Li, Director Asia, over 11 years– Teresa Hon – over 30 years

• Bruce Ross, Brussels, 11 years

Consultants:• Chile, China, Indonesia, Vietnam

Strategic Intention - Global

• Domestic and international markets – Promote the demand and market access for rendered products to domestic and international customers. Secure adequate resources from key strategic partnerships (members, federal government and strategic allies).

NRA’s Efforts

• NRA works through the US Agricultural Export Development Council

• Agricultural Trade Advisory Committee• Agricultural Policy Advisor Committee• Coalitions in WDC• Cooperation with APHIS, FAS, and USTR

U.S. Rendering Plants

= Packer Renderers = Independent Renderers National Renderers Association,

2016

Supply/Demand

U.S. Red Meat and Poultry Production

0

5

10

15

20

25

30

35

40

45

1990 1995 2000 2005 2010 2015 2020 2026

Billion pounds

Broilers

Beef

Pork

Source: USDA/ERS

Source: Projections based off of USDA ERS Projections and USDA NASS production reports

Source: USDA/FAS PS&D

Aquaculture Production

Source: 2016 State of the Worlds Fisheries and Aquaculture, FAO

Supply – Protein Meals

Demand - Proteins

Indonesia

Chile

US MBM, PBM, Porcine Meal Exports

Supply – Fats and Oils

Supply Fats and Oils

Demand – Fats and Oils

US Tallow Exports

US UCO/YG Exports

Singapore

China UCO

Global Biodiesel/HVO Production

Hydrotreated Vegetable Oils (HVO)

Global HVO Plants/Production Trend

Source: Greenea.com

Distillers Corn Oil

Changing Markets

Retaliatory Tariffs

China Retaliatory Tariffs

• January 2017 – China imposed 42.2% - 53.7% duties on US DDGS with additional anti subsidy tariffs between 11.2% and 12%

• July 6 – China imposed 25% duty on US soybeans

• August 3 - China announced additional tariffs this time including processed animal protein meals and hides – 10% for meals

• September 24 – Tariffs imposed on US processed animal protein meals at 5%

• September 24 – Tariffs imposed on US fishmeal at 25%

Immediate impact

• US DDGS exports to China dropped from over 5 million mt to under 1 million

• Soybean prices dropped 20%• Rendered protein meals?• Fishmeal?

Impact - Soy

Source: USDA/FAS Oilseeds, World Markets and Trade, Sept 18

Fishmeal Imports

• China imports around 1 mmt of fishmeal• The US exports approximately 100,000 metric

tons of fishmeal to China or 10% of total imports

Economic

Economic

US Exports of Animal Protein Meals

Source: Global Trade Atlas

USMCA

Trends - Sustainability

Trends - Information

Thank You