The U.S. and Indonesia have announced a framework for a trade agreement. As U.S. Meat Export Federation Vice President of Economic Analysis Erin Borror points out, the country has had significant non-tariff trade barriers in place for U.S. beef.
“This is a region where we have very limited access,” Borror explains. “We have both tariff and non-tariff barriers. And for Indonesia in particular, we are looking at, not so much a tariff barrier, because their tariffs are low at 5%, but a bunch of non-tariff barriers, including specifically the import licensing regime, the commodity balance, and facility registration, or plant-by-plant approvals.”
Those three pillars of market access barriers are how Indonesia has managed imports for decades, she says. Removing all non-tariff barriers would open the doors for U.S. beef demand in Indonesia.
“The opportunity there is $250 million annually,” Borror says. “That’s a short-run estimate. If we remain out of that China market, having Indonesia compete on these short plates, short ribs, chuck short ribs… would be tremendous.”
U.S. pork faces similar trade barriers in Indonesia, a country with 30 million non Muslims who have shown a growing demand for U.S. pork.
“African swine fever remains rampant, kind of in the region,” Borror says. “So yes, there is still more potential. We know that Indonesian customers keep asking for more U.S. pork.”
