August 23, 2017

Ag Groups Tenatively Hopeful On NAFTA Renegotiation, But Fear The Unknown

The Trump administration has officially notified Congress on Thursday that it intends to renegotiate the North American Free Trade Agreement. Agriculture groups have reacted to the news with caution.

The National Pork Producers Council is urging the president to make sure that tariffs remain at zero for pork traded throughout North America. Tariff-free access to Canada and Mexico last year were worth $799 million and $1.4 billion respectively. “Canada and Mexico are our top export markets,” says NPPC President Ken Maschoff, “and we absolutely must not have any trade disruptions.”

U.S. Wheat Associates and the National Association of Wheat Growers are also hoping for caution in the upcoming negotiations. While the groups welcome the chance to improve the agreement, they oppose changes that would limit benefits to wheat growers, especially in the Mexican food processing industries. American wheat imports began surging in Mexico after NAFTA, and Mexico is now the largest buyer of American wheat.  A statement released by the pair read “Negotiating a new NAFTA certainly can make improvements. A good place to start are the sanitary and phytosanitary (SPS) rules that the three countries already agreed to as part of the Trans-Pacific Partnership (TPP) negotiations”

However, NAWG President David Schemm added a caveat saying:

 “If the administration intends on renegotiating NAFTA, it must guarantee growers that new terms won’t reverse the significant benefits for U.S. wheat farmers, like duty free access. Despite the risks, there’s an opportunity here to get better trade rules in place that will set the gold standard for trade agreements going forward, without hurting wheat farmers and their importing customers.”

For his part, new Agriculture Secretary Sonny Perdue released a statement saying that NAFTA has been generally good for American Ag but there is always room for improvement.  He added thats part of the reason for the recently announced undersecretary of trade at USDA who will serve as “an unapologetic advocate for American Agriculture”.  While the position has been created, so far no names have been submitted for consideration to fill the spot.  Negotiations with Mexico and Canada could begin as soon as August 16th.

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