UPDATE 1-U.S. pork exports to China 'not viable' due to trade war -Smithfield CEO

CEO@ (Adds CEO comments, details on Smithfield's environmental efforts, industry background)

CHICAGO, Oct 26 (Reuters) - U.S. pork sales to China are "not viable" after Beijing earlier this year imposed tariffs on imports of American pork, Smithfield Foods' chief executive said on Friday, as the trade war between the world's two largest economies threatened a nearly $500 million business for U.S. hog farmers.

The decline in meat exports to China, the world's top consumer of pork, adds to pain felt by farmers caught in the crossfire of the trade dispute. In April, China slapped a 25 percent import duty on most U.S. pork items, retaliating against U.S. tariffs on Chinese steel and aluminum products. Pork also was included in a second round of tariffs introduced in July.

Smithfield CEO Ken Sullivan was speaking to Reuters as Smithfield, the world's biggest pork producer and a division of China's WH Group Ltd, said it is covering pits that hold hog manure to reduce greenhouse gas emissions as part of an environmental effort.

Virginia-based Smithfield has been tested this year by the U.S.-China trade war and Hurricane Florence, which killed thousands of hogs and flooded waste lagoons in North Carolina.

The company is eager for a resolution to the trade row, Sullivan said.

"Certainly in the short term here as this trade war has heated up, it's made the trade with China very difficult - to even stopping at various points - because the tariff that's been imposed makes it not viable to do that," Sullivan said.

Separately, the company said it will work with hog farmers to install waste lagoon covers at 90 percent of its hog operations in North Carolina, Missouri and Utah during the next decade.

"It's a very substantial investment; it's not a couple of million dollars," he said.

Capturing methane from manure and converting it to natural gas will help meet the company's goal of cutting greenhouse gas emissions by 25 percent by 2025. Smithfield already has covers at some of its hog farms, primarily in Missouri.

"When you think about the carbon footprint we have, animal waste is at the top," Sullivan said.

Covering lagoons also minimizes the risk that lagoons could overflow. More than 5,000 hogs were killed and a dozen manure pits overflowed last month in North Carolina due to Hurricane Florence, stoking concerns about water contamination.

Smithfield faces lawsuits from North Carolina residents who live near its hog farms and say they have suffered because of the smell of the manure. (Reporting by Michael Hirtzer and Tom Polansek in Chicago Editing by Chizu Nomiyama and Matthew Lewis)