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Illustration: Eniola Odetunde/Axios

The U.S. pork industry — whose commodity was among the hardest hit by China's retaliatory tariffs — breathed a sigh of cautious relief following news of a deal that winds down tensions between the U.S. and China.

Why it matters: The deal in theory is a reprieve for farmers, a key part of President Trump's base who have borne the brunt of the trade war. China's purchases of goods like soybeans and pork have waned in the nearly two-year battle — pushing rural America into a financial tailspin in an otherwise solid economy.

Driving the news: U.S. officials said China would up annual purchases of U.S. farm goods to at least $40 billion over a period of two years.

  • But there are no details yet on which goods it'll buy or how China plans to absorb that level of imports. The most China ever purchased from U.S. producers was $29 billion in 2013, per Bloomberg.
  • Hog futures — along with other commodities — rose 1% on news of the deal.

Industry experts say the ceasefire could create new prospects for farmers — but won't undo the missed opportunity to cash in on China's pork shortage, partly due to African swine fever.

  • Pork exports to China haven't "accelerated at the rate that it could have if we didn't have these [trade] obstacles," Joe Schuele, head of communications at the U.S. Meat Export Federation, an industry trade group, tells Axios.
Expand chart
Data: China's monthly consumer price index via FactSet; Chart: Axios Visuals

The backdrop: The trade war coincided with a breakout of African swine fever, a deadly pig disease that killed hundreds of millions of hogs in eastern Asian countries, as Axios' Jacob Knutson reported earlier this year.

  • Pork prices in China surged triple digits from the prior year in November. The jump in prices pushed China's overall inflation index to rise at the quickest pace in about eight years, per the latest data from the Chinese government.
  • The epidemic had China — the world's top pork consumer — looking offshore to fill the supply gap, a potential goldmine for U.S. farmers.
  • U.S. ramped up herds in anticipation of more demand, with processors slaughtering about 1 million more pigs per week than a year ago, per Reuters.

Yes, but: The U.S. pork industry faced three rounds of retaliatory tariffs. In 17 months, tariffs on pork exports to China increased sixfold (from 12% to 72%).

  • That made it less palatable for Chinese buyers to turn to the U.S. for help, but not totally out of the question.
  • Those that did import from the U.S. sometimes pushed the price hikes back onto U.S. packers and producers — making it less profitable to export to China, Schuele says.

As a result, European suppliers have capitalized much more on China's pork shortage. So has Brazil.

What's next: "We're encouraged that a deal has been reached and we're anxious to get the details," Schuele says — a sentiment echoed by the industry's most prominent trade groups.

  • There may be some opportunity to take advantage of China's upcoming all-important Lunar New Year celebration, which tends to be the country's biggest period of pork consumption.

Go deeper: Chicken consumption is closing in on red meat

Go deeper

Alabama's new congressional map rejected by federal judges

The Alabama State Capitol in Montgomery. Photo: Taylor Hill/Getty Images

Federal judges on Monday night blocked Alabama's newly drawn congressional map and ordered the Republican-led State Legislature to create a new one that includes two districts, rather than the planned one.

Why it matters: "Black voters have less opportunity than other Alabamians to elect candidates of their choice to Congress," the panel of three judges wrote in their ruling.

Australian Open organizers reverse "Where is Peng Shuai?" t-shirt ban

Chinese tennis player Peng Shuai during the 2020 Australian Open in Melbourne. Photo: Bai Xue/Xinhua via Getty Images

Australian Open organizers on Tuesday reversed a ban on t-shirts supporting Chinese tennis player Peng Shuai following widespread criticism.

Why it matters: Tennis Australia's announcement came less than 24 hours after the governing body defended the decision to ask fans last Friday to remove "Where is Peng Shuai?" t-shirts, citing ticket policy prohibiting political clothing, per the BBC.

FDA limits use of Regeneron and Lilly COVID antibody treatments

A coldbox containing monoclonal antibody treatments at a Regeneron clinic in Pembroke Pines, Florida, in August. Photo: Eva Marie Uzcategui/Bloomberg via Getty Images

The FDA said Monday it's limiting the use of two monoclonal antibody therapies as COVID-19 treatments because data indicates they're "highly unlikely" to be effective against the dominant Omicron variant.

Driving the news: The FDA revised the authorizations for Regeneron and Eli Lilly "to limit their use to only when the patient is likely to have been infected with or exposed to a variant that is susceptible to these treatments," per a statement from the agency.