April 20, 2014

Japan Offers Reduced Tariff on U.S. Beef — With A Catch . . .

Reports are Japan is considering cutting U.S. beef import tariffs to less than 10-percent from the current 38.5-percent level as part of the Trans-Pacific Partnership negotiations. This cut would be bigger than the one negotiated recently with Australia. Along with this proposal – Japan is considering imposing restrictions – if U.S. beef imports increase considerably due to the decreased tariff. The U.S. still has various ag sectors it wants Japan to open – so there is still considerable distance between U.S. and Japan on TPP negotiations.

Negotiators hope to have the deal wrapped up by the end of the year


U.S. Grains Council Releases Annual Corn Export Quality Report

The U.S. Grains Council recently released its 2013/2014 Corn Export Cargo Quality Report and will begin presenting the report’s findings to buyers and other stakeholders around the world in coming weeks. The Export Quality Report measures the quality of U.S. corn sampled at the point of loading for export. Three export channels are reported: the Gulf of Mexico, the Pacific Northwest and inland terminals shipping by rail to Mexico.  “We set out to raise the bar with data reporting,” says Tom Sleight, U.S. Grains Council president and CEO. “The Council is providing an unmatched level of information about the U.S. corn crop, reinforcing the U.S. reputation for quality, reliability and transparency.”

Now in its third year, the release of the Corn Export Quality Report has become a much-anticipated annual event, attracting large audiences around the world for the roll-out presentations. “Our purpose is to give U.S. corn buyers reliable and timely information,” Sleight said. “The interest generated in the report demonstrates we are meeting and exceeding their needs.” This year’s report finds – while there is year-over-year variability by each export channel – that overall quality continues to be very good with the average aggregate quality of export corn exceeding standards for U.S. No. 2 on all grading scales. In addition, the incidence of aflatoxin and DON is very low, with all samples tested below the FDA action levels/advisory levels. As compared to a year ago, other findings included slightly lower test weight, higher moisture content due to a wetter year, and a higher incidence of stress cracks and broken kernels, likely due to additional drying.


Australia and Japan Reach Bilateral Trade Agreement Outside of TPP Talks

News broke today that Australia and Japan, two member of the recent Trans Pacific Partnership talks have reached a bilateral trade agreement outside of the TPP negotiations.  The news comes as a blow to U.S. negotiators that had been attempting to push Japan into a more open market situation that didn’t exclude certain industries.

While details on the Australian -Japanese agreement are not completely clear, it is reported that the agreement does little in the way of tariff reduction, which was a major goal of the TPP talks.  U.S. Ag Secretary Vilsack was quoted as saying that the agreement reduced existing tariffs by only a small about and over a long period of time.

National Cattlemen’s Beef Association President Bob McCan says the association is deeply concerned the agreement between the two countries doesn’t call for full tariff elimination. McCan says the Bilateral Agreement undermines the goals and principles at the base of the Trans-Pacific Partnership – which only pushes the high-standing ideals of TPP further out of reach for all countries involved. He says it isn’t a move U.S. beef producers can support. While the TPP has been called a 21st Century agreement – McCan says the Bilateral Agreement between Japan and Australia is from the 20th Century playbook and won’t foster open trade – and certainly won’t benefit consumers and producers around the world.

The National Pork Producers Council also released a statement again calling on Japan to eliminate all tariff and non-tariff trade barriers for U.S. ag products as part of the Trans-Pacific Partnership negotiations. NPPC says accepting Japan’s demands to exclude certain products from the deal would be a radical departure from past U.S. trade agreements and open the door to other exemptions from other TPP negotiating countries – and in future U.S. trade deals. NPPC President Dr. Howard Hill says Japan is asking for special treatment in the form of exempting myriad tariff lines from tariff elimination – yet tariff elimination is the heart of a free trade agreement. Hill says NPPC supports the efforts of U.S. Trade Representative Michael Froman and the U.S. trade team to get the same result from Japan the U.S. has gotten from every other U.S. FTA partner – elimination of virtually all tariffs.