Jake Harper
The Chicken War refers to a trade dispute between the United States and the Common Market countries of Europe over chicken tariffs in the early 1960s. The Common Market countries, including France, West Germany, Italy, Belgium, the Netherlands, and Luxembourg, raised their common outer tariff on poultry, which significantly impacted the US poultry industry, particularly in Arkansas, a major poultry-producing state. In response, the US imposed tariffs on European goods, including trucks, brandy, dextrine, and potato starch. The Chicken War also had broader implications for trade relations and liberal trading policies between the US and Europe.
| Characteristics | Values |
|---|---|
| Date | 1962-1963 |
| Type of conflict | Trade dispute |
| Origin | Europe imposing tariffs on US chicken |
| US response | Tariffs on European trucks, brandy, dextrin, and potato starch |
| US exports lost | 25% of European chicken sales |
| US poultry industry losses | $26-$28 million |
| US poultry exports affected | 50 semi-truck loads of ice-packed fryers every week |
| US retaliation target | European goods |
| US tariff rate | 25% |
| US tariff duration | Since 1964 |
| Impact on US domestic market | Lower prices due to excess supply |
| Impact on Asian truck companies | Squeezed out of the American pickup market |
| Impact on Detroit | Reduced pressure to introduce less polluting and more fuel-efficient vehicles |
| Resolution | Armistice reached with both sides claiming victory |
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What You'll Learn
The US's loss of chicken exports
The Chicken War, which took place between 1961 and 1964, was a trade dispute between the United States and the Common Market (also known as the European Economic Community) over chicken tariffs. The conflict was triggered by the Common Market countries' decision to impose tariffs and price controls on imported chicken, which significantly impacted US poultry exports to Europe.
In the late 1950s, poultry producers in Arkansas and other US states began exporting chicken to Western Europe. By the early 1960s, Arkansas's Benton County was producing more chicken than some European nations. However, in 1962, the six member nations of the Common Market—France, West Germany, Italy, Belgium, the Netherlands, and Luxembourg—raised their common outer tariff on poultry to 13.43 cents per pound. This dramatic increase in tariffs led to a sharp decline in US chicken exports to Europe. By August 1962, US exporters had lost 25% of their European chicken sales, resulting in losses of $26-$28 million for the US poultry industry.
The loss of chicken exports had significant economic implications for the United States, particularly for poultry-producing states like Arkansas. The American poultry industry vehemently protested the Common Market's actions, arguing that the tariffs presented "one of the biggest problems ever faced by the poultry industry." The issue was also exacerbated by allegations from European officials that US chicken was diseased, which the Americans deemed "propaganda."
The US government responded to the loss of chicken exports by imposing retaliatory tariffs on European goods, including a 25% tariff on light trucks, potato starch, dextrin, and brandy. These tariffs were imposed under the justification of offsetting losses incurred by the United States due to the Common Market's tariffs. While the US claimed victory in the Chicken War based on this retaliation, it failed to recover the lost chicken exports for Arkansas and other states.
The Chicken War raised concerns about the future of liberal trading policies and the potential rise of protectionist measures. It also highlighted the economic and political importance of the poultry industry in the United States, particularly in states like Arkansas, where it was a significant contributor to the economy.
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Europe's Common Agricultural Policy
The Chicken War was a period of tension and negotiations between the United States and Europe's Common Market, which took place between 1961 and 1964. The conflict centred on Europe's Common Agricultural Policy (CAP), which imposed minimum import prices on all imported chicken, effectively restricting imports of American poultry. This policy was implemented by the European Economic Community (EEC) and was designed to encourage Europe's postwar agricultural self-sufficiency.
The Common Agricultural Policy was established by the 1957 Treaty of Rome, which created the EEC and aimed to create an open market throughout Europe. The CAP provided agricultural subsidies for member countries and eliminated internal tariffs. While the United States was initially a major proponent of the CAP, it soon became clear that the creation of a single agricultural market in Europe would result in short-term losses for American imports, as new barriers to trade were introduced.
The Chicken War began in mid-1962 when the six member nations of the Common Market—France, West Germany, Italy, Belgium, the Netherlands, and Luxembourg—raised their common outer tariff on poultry. This led to a 25% loss in European chicken sales for the United States poultry industry, amounting to an estimated $26–$28 million in losses (equivalent to $270.27–$291.06 million in 2024). The American poultry industry, centred on the Atlantic seaboard, vehemently protested these losses, and the issue escalated to a high political level.
In response to the Common Market's tariffs, the United States invoked its right under the General Agreement on Tariffs and Trade (GATT), which allows an offended nation to increase tariffs by an amount equal to losses from discriminating tariffs. As a result, in 1964, President Lyndon B. Johnson imposed a 25% tariff on light trucks, potato starch, dextrin, and brandy from Europe, which was equivalent to the losses incurred by the US poultry industry. This tariff on light trucks remains in place as of 2023 and has given US domestic automakers an advantage over imported competitors.
Today, the Common Agricultural Policy is still one of the European Union's most highly debated policies. In 2025, farmers from across the EU protested against plans to cut the CAP's budget and reduce farming subsidies. There have also been protests against the EU's environmental mandates, such as the European Green Deal, which has been seen as an attack on farmers and a threat to the continent's food security.
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The US imposes tariffs on European goods
The "Chicken War" refers to the trade dispute between the United States and Europe, specifically France and West Germany, from 1961 to 1964. During this period, the US imposed tariffs on European goods in response to Europe's increased tariffs on American chicken imports.
In the early 1960s, as globalisation increased post-World War II, European farmers became concerned about the growing market share of American poultry in Europe. American chicken was cheap and abundant, threatening to price European farmers out of their own market. In response, the European Economic Community (EEC) (later absorbed into the European Union) formed a common agricultural policy, imposing minimum import prices on all imported chicken. This effectively curbed American chicken imports and protected European farmers.
The US retaliated by imposing a 25% tariff (almost ten times the average US tariff) on certain goods imported from Europe, including light trucks, potato starch, dextrin, and brandy. This tariff was intended to recoup the losses incurred by the US due to Europe's chicken tariffs, which were estimated at $26-28 million. The US invoked its right under the General Agreement on Tariffs and Trade (GATT), which allows an offended nation to increase tariffs by an amount equal to losses from discriminating tariffs.
The US tariff on light trucks, known as the "Chicken Tax," has had a significant impact on the automotive industry. It effectively "squeezed smaller Asian truck companies out of the American pickup market" and gave US domestic automakers an advantage over imported competitors. While the tariffs on potato starch, dextrin, and brandy were eventually lifted, the Chicken Tax remains in place as of 2023, more than 50 years after its implementation.
The Chicken War and the resulting tariffs significantly shifted the trade dynamics between the US and Europe. While the specific tariffs on European chicken imports have since expired, the Chicken Tax continues to affect light truck imports into the US, impacting the automotive industry on both sides of the Atlantic.
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The US's concern over liberal trade policies
The Chicken War, a colloquial name for the trade dispute between the US and the Common Market (also known as the European Economic Community) over chicken tariffs in the early 1960s, raised concerns about the future of liberal trade policies. The US poultry industry, centred on the Atlantic seaboard, vehemently protested the Common Market's increased tariffs, fearing not only the loss of their lucrative chicken exports but also the potential shift towards a broader protectionist agricultural policy in Europe.
The Common Market, consisting of France, West Germany, Italy, Belgium, the Netherlands, and Luxembourg, had raised their common outer tariff on poultry to 13.43 cents per pound in 1962, dramatically impacting US poultry exports. This move by the Common Market was seen as a threat to the goal of achieving liberal trade policies and a closer trading partnership between the US and Europe. The US poultry industry and government officials recognised the broader implications of the chicken tariffs, which extended beyond the immediate financial losses.
The US government shared the concerns of poultry producers and took action. They imposed retaliatory tariffs on European goods, specifically targeting items imported from Europe approximating the value of lost chicken sales. These retaliatory tariffs included a 25% tariff on light trucks, known as the "Chicken Tax," as well as tariffs on potato starch, dextrin, and brandy. The US government's response demonstrated its commitment to defending free trade and addressing the concerns of its domestic industries.
The Chicken War highlighted the challenges faced by the US in promoting liberal trade policies in a complex international environment. While the specific issue of chicken tariffs was eventually resolved through arbitration, the broader tension between free trade and protectionism persisted. The US's concerns over liberal trade policies during the Chicken War reflected a broader geostrategic context, including the Cold War politics of the time.
The outcome of the Chicken War had lasting implications for US trade policy and the global trade landscape. While the specific tariffs on potato starch, dextrin, and brandy were eventually lifted, the 25% tariff on light trucks remained in place for decades, impacting the automotive industry and shaping international trade dynamics.
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The impact on the US's international payments position
The Chicken War, a trade dispute between the US and the Common Market (the European Economic Community), had a significant impact on the US's international payments position. The conflict centred on the Common Market's decision to impose tariffs on poultry imports from the US, which resulted in a loss of $26–$28 million for the US poultry industry. This loss further aggravated the US's already delicate international payments position.
The Common Market countries purchased $1.25 billion in US farm products annually, accounting for about one-fourth of all agricultural exports. The sharp drop in poultry exports threatened to severely impact this significant contribution to the US's agricultural exports. The Chicken War also raised concerns about the future of liberal trading policies and the potential emergence of protectionist trade barriers.
The US government responded to the Common Market's tariffs by imposing retaliatory tariffs on European goods, including trucks, brandy, dextrine, and potato starch. While these tariffs were valued at approximately $26 million, equivalent to the losses incurred by the US poultry industry, they failed to recover the lost exports. This failure highlights the challenges the US faced in mitigating the negative impact on its international payments position.
The impact of the Chicken War extended beyond the immediate financial losses. It also disrupted the US poultry industry's access to European markets, which they had helped develop through knowledge transfer and collaboration with European producers. The loss of these export opportunities led to an oversupply in the domestic market, causing a decline in prices and further financial strain on US poultry producers.
In conclusion, the Chicken War negatively affected the US's international payments position by reducing exports to the Common Market countries, failing to recover lost exports through retaliatory tariffs, and disrupting the US poultry industry's access to important European markets. The conflict contributed to concerns about protectionist trade policies and highlighted the challenges faced by the US in maintaining its international trade position.
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Frequently asked questions
The Chicken War was a trade dispute between the United States and the Common Market (a European Economic Community comprising six nations: France, West Germany, Italy, Belgium, the Netherlands, and Luxembourg) over chicken tariffs in 1962–1963.
The Chicken War was caused by the Common Market countries' decision to raise their common outer tariff on poultry to 13.43 cents per pound, which dramatically reduced exports from the US poultry industry.
In 1964, the United States imposed a 25% tariff on light trucks and other goods from Common Market countries in retaliation for the poultry tariffs. This armistice meant that both sides could claim victory—the US on the principle of retaliation, and the Common Market on the low estimate of US losses.
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