Aug 26, 2019

Agreement in principle reached on trade between US, Japan

The U.S. and Japan have announced an agreement in principle on a new agricultural trade deal.

Japan Prime Minister Shinzō Abe and U.S. President Donald Trump jointly announced the agreement in Biarritz, France, on Aug. 25.

Trump said Japan would buy big quantities of U.S. corn, with the deal expected to be signed around the time of the United General assembly in late September.

The agreement will also benefit U.S. exports to Japan of beef, pork, wheat, dairy products, wine, ethanol, and a “variety of other products,” U.S. trade officials said.

U.S. and Japanese officials did not specifically mention fruit and vegetable commodities in their announcement.

“We still have some remaining work that has to be done at the working level, namely finalizing the wording of the trade agreement and also finalizing the content of the agreement itself,” Abe said in a news release.

Abe said pest issues in Japan have hurt production of some farm commodities, which opens the door for purchases of more U.S commodities.

“We believe that there is a need for us to implement emergency support measures for the Japanese private sector to have the early purchase of the American corn,” he said.

U.S. Trade Representative Robert Lighthizer said the agreement includes agriculture, industrial tariffs, and digital trade.

He said Japan the third-largest agricultural market for the U.S., buying about $14 billion worth of U.S. agricultural products.

The trade deal, he said, will open up markets to over $7 billion of those products.

“It will lead to substantial reductions in tariffs and non-tariff barriers across the board,” Lighthizer said.

Ag secretary issues statement

U.S. Secretary of Agriculture Sonny Perdue issued the following statement regarding the new trade agreement between the United States and Japan:

“Japan is a significant market for United States agriculture exports, making today a good day for American agriculture. By removing existing barriers for our products, we will be able to sell more to the Japanese markets. At the same time we will able to close gaps to better allow us to compete on a level playing field with our competitors. I thank President Trump and Ambassador Lighthizer for their constant support of America’s farmers and ranchers and their hard work negotiating better trade deals around the globe.”

Western Growers respond

In response to news that the U.S. and Japan have agreed in principle to a trade deal involving American agricultural products, along with industrial tariffs and digital trade, Western Growers President and CEO Tom Nassif issued the following statement:

“Western Growers is extremely pleased to learn of the deal in principle between the U.S. and Japan, the third-largest market for American agricultural products. We are encouraged that the agreement will lead to substantial reductions in tariff and non-tariff barriers to access to the Japanese market, which will level the playing field for U.S. farmers, in particular, producers of fruits, vegetables and tree nuts.

“Tariff equity for U.S. fresh produce is one of our most important international trade priorities, with Japanese tariffs on American agricultural products reaching as high as 35% for some commodities. Of equal importance is the need for sanitary and phytosanitary (SPS) reforms, as Japan’s current SPS regulatory regime prohibits many high-quality U.S. fruits, vegetables and tree nuts from entering the Japanese market.

“The anticipated reductions in tariffs and SPS barriers will result in true market gains and much needed economic relief for an industry that has already been caught in the crosshairs of trade wars on other fronts.

“We applaud the efforts of President Trump, Prime Minister Abe and trade representatives from both countries to secure a mutually beneficial deal that will result in significant export opportunities for Western Growers members and the broader agricultural industry.”