Dec 11, 2019
USMCA headed to Congress – vote expected next week

Long-awaited news on the pending U.S.-Mexico-Canada Agreement was announced Dec. 10 in an apparent deal between the Trump administration, United States Trade Representative Robert Lighthizer and Speaker of the House Nancy Pelosi. The package now moves forward legislatively.

U.S. Secretary of Agriculture Sonny Perdue issued the following statement after United States Trade Representative Robert Lighthizer and Speaker of the House Nancy Pelosi announced agreement Dec. 10 on the U.S.-Mexico-Canada Agreement (USMCA):

“USMCA is a big win for American workers and the economy, especially for our farmers and ranchers. The agreement improves virtually every component of the old NAFTA, and the agriculture industry stands to gain significantly,” said Secretary Perdue. “President Trump and Ambassador Lighthizer are laying the foundation for a stronger farm economy through USMCA and I thank them for all their hard work and perseverance to get the agreement across the finish line. While I am very encouraged by today’s breakthrough, we must not lose sight – the House and Senate need to work diligently to pass USMCA by Christmas.”

Background

USMCA will advance United States agricultural interests in two of the most important markets for American farmers, ranchers, and agribusinesses. This high-standard agreement builds upon our existing markets to expand United States food and agricultural exports and support food processing and rural jobs.

Canada and Mexico are our first and second largest export markets for United States food and agricultural products, totaling more than $39.7 billion food and agricultural exports in 2018. These exports support more than 325,000 American jobs.

All food and agricultural products that have zero tariffs under the North American Free Trade Agreement (NAFTA) will remain at zero tariffs. Since the original NAFTA did not eliminate all tariffs on agricultural trade between the United States and Canada, the USMCA will create new market access opportunities for United States exports to Canada of dairy, poultry, and eggs, and in exchange the United States will provide new access to Canada for some dairy, peanut, and a limited amount of sugar and sugar-containing products.

Earlier this year, nearly 1,000 American food and agriculture associations and companies announced their support for USMCA and the National Association of State Departments of Agriculture signed a letter to Congressional leadership urging them to ratify USMCA.

In September, all former U.S. Secretaries of Agriculture since President Reagan’s Administration announced support for USMCA. In a letter to Congressional leaders (PDF, 86.0 KB), former Secretaries John Block (Reagan), Mike Espy (Clinton), Dan Glickman (Clinton), Ann Veneman (W. Bush), Mike Johanns (W. Bush), Ed Shafer (W. Bush), and Tom Vilsack (Obama) underscored the importance of passing USMCA saying, “We need a strong and reliable trade deal with our top two customers for U.S. agriculture products. USMCA will provide certainty in the North American market for the U.S. farm sector and rural economy. We strongly support ratification of USMCA.”

Key provision: Increasing dairy market access

  • America’s dairy farmers will have expanded market opportunities in Canada for a wide variety of dairy products. Canada agreed to eliminate the unfair Class 6 and 7 milk pricing programs that allowed their farmers to undersell U.S. producers.

Key provision: Biotechnology

  • For the first time, the agreement specifically addresses agricultural biotechnology – including new technologies such as gene editing – to support innovation and reduce trade-distorting policies.

Key provision: Geographical indications

The agreement institutes a more rigorous process for establishing geographical indicators and lays out additional factors to be considered in determining whether a term is a common name.

Key provision: Sanitary/phytosanitary measures

  • The three countries agree to strengthen disciplines for science-based measures that protect human, animal, and plant health while improving the flow of trade.

Key provision: Poultry and eggs

  • U.S. poultry producers will have expanded access to Canada for chicken, turkey, and eggs.

Key provision: Wheat

  • Canada agrees to terminate its discriminatory wheat grading system, enabling U.S. growers to be more competitive.

Key provision: Wine and spirits

  • The three countries agree to avoid technical barriers to trade through non-discrimination and transparency regarding sale, distribution, labeling, and certification of wine and distilled spirits.Western Growers Applauds USMCA Announcement

Western Growers response

In response to the announcement that a deal on the U.S.-Mexico-Canada Agreement (USMCA) was reached between the Administration and Congress, which received subsequent approval from the Mexican and Canadian governments, Western Growers President and CEO Tom Nassif issued the following statement:

“Western Growers applauds the Administration and a strong, bipartisan contingent of congressional representatives for their diligent work in producing an outstanding trade agreement for American agriculture. We commend President Trump, Ambassador Lighthizer, Ambassador Doud and the Administration’s team for their success in renegotiating NAFTA and securing freer and fairer trade opportunities for our country.

“In this turbulent trade environment, American farmers need certainty more than ever. The USMCA not only reaffirms our strong economic ties with our North American neighbors, it offers a new model for how U.S. trade deals should be structured in the future.

“For the fruit, vegetable and tree nut industry, this deal ensures continued access to our top two export markets while making much needed sanitary-phytosanitary (SPS) updates that will improve our defenses against devastating pests and diseases. Additionally, the USMCA achieves groundbreaking labor reforms, requiring Mexico to substantially improve its wages and labor standards, which will improve the competitiveness of our domestic growers in an increasingly global marketplace.

“We appreciate the commitment both parties have demonstrated in setting aside their political differences and negotiating this agreement in good faith. The result is a deal that addresses the concerns of all sides and will enhance economic opportunities for businesses across the country. We urge Congress to quickly approve this agreement and deliver a victory for American farmers.

“Finally, we are hopeful that this spirit of bipartisan cooperation between the Administration and Congress will extend into other public policy debates impacting the agriculture industry, including the need to resolve the labor crisis facing our nation’s farms.”

Michigan Farm Bureau reaction

Long-awaited news on the pending U.S.-Mexico-Canada Agreement (USMCA) was finally announced today in an apparent deal between the Trump administration, United States Trade Representative Robert Lighthizer, and Speaker of the House Nancy Pelosi. The package now moves forward legislatively.

Carl Bednarski, a Tuscola County farmer and president of the Michigan Farm Bureau (MFB), the state’s largest general farm organization, said the announcement couldn’t come at a better time for the organization’s 44,000 farmer members.

“As the U.S. farm economy continues to feel the effects of numerous trade disputes that have impacted agricultural exports and prices, we are at a critical juncture for approval of a modernized trade deal with Mexico and Canada,” Bednarski said. “Now, it’s time for Congress to take the final step and ratify it immediately.”

According to Bednarski, MFB has actively advocated for USMCA approval since the proposed trade deal to upgrade the 25-year-old North American Free Trade Agreement (NAFTA) was announced between the three countries just over a year ago.

“NAFTA was over a quarter-century old and needed to be upgraded,” Bednarski said. “USMCA does just that — so we’re pleased that it appears there’s finally progress in moving USMCA forward.”

Bednarski, who serves on the American Farm Board of Directors Trade Advisory Committee, expects the USMCA trade deal, once formally ratified, to serve as a model trade agreement in other ongoing trade negotiations, including the European Union and Southeast Asia.

“USMCA is the first free trade agreement for the U.S. that includes measures to address information-sharing and other trade rules related to biotechnology and gene editing,” Bednarski said. “It also enhances science-based trading standards among the three nations as the basis for sanitary and phytosanitary measures for ag and food products.”

USMCA is expected to increase U.S. ag exports by $2 billion and result in a $65 billion increase in gross domestic product.

In 2018, more than 29% of all U.S. farm and food exports totaling $40 billion, went to Canada and Mexico making the two countries a top export market for U.S. agriculture. Those exports also supported more than 325,000 American jobs.

For Michigan’s rural economy, the state’s annual $3 billion in agricultural exports to Canada and Mexico supported 22,800 jobs in 2018. A significant component of USMCA to Michigan is its impact on the state’s dairy industry.

MFB Livestock and Dairy Specialist Ernie Birchmeier said USMCA makes important changes to Canada’s trade-distorting policies and reforms controversial dairy pricing system while providing exclusive access to the Canadian market for U.S. farmers and manufacturers.

“USMCA will add an estimated $548 million to dairy-farm revenues in its first six years after implementation,” Birchmeier said. “Progress on USMCA is certainly welcomed news to Michigan’s dairy economy, after the last five year’s of dismal milk prices.”

Earlier this year, nearly 1,000 American food and agriculture associations and companies announced their support for USMCA and the National Association of State Departments of Agriculture signed a letter to Congressional leadership urging them to ratify USMCA.

 California Farm Bureau welcomes agreement on USMCA

Rural and urban California will benefit from improved agricultural trade, and the California Farm Bureau Federation said it’s pleased by today’s announcement of a pending vote on the United States-Mexico-Canada Agreement. The USMCA will reduce barriers to trade throughout North America.

 “We’ve been advocating for months for a vote on the USMCA, so we’re happy the White House and Speaker Pelosi have agreed to move forward,” CFBF President Jamie Johansson said. “As a Californian, Speaker Pelosi recognizes how the USMCA will help most California agricultural products gain improved market access to two top export customers.”

 Canada is the No. 2 market for California agricultural exports and Mexico ranks fifth. Combined farm exports to the USMCA partners exceeded $4.3 billion in 2017, according to the California Department of Food and Agriculture.

 “California food and agricultural exports to Canada and Mexico support more than 56,000 jobs – and jobs will be added as those exports increase,” Johansson said. “Those jobs will benefit rural and urban areas. Agricultural exports support jobs at ports, marketing companies, food processors, trucking firms and other businesses that prepare and move agricultural products from California farms and ranches to customers in Canada and Mexico.”

 He said the USMCA will strengthen science-based procedures to protect human, animal and plant health – known as sanitary and phytosanitary measures—while improving the flow of trade. It also contains specific provisions to benefit exports of processed fruits, milk and dairy products, beef, wine, poultry and eggs, and other products.

“We’re encouraged by prospects for a quick, positive vote on USMCA in the House of Representatives,” Johansson said. “The sooner that happens, the sooner Californians will begin reaping the benefits the agreement will bring.”

The California Farm Bureau Federation works to protect family farms and ranches on behalf of nearly 34,000 members statewide and as part of a nationwide network of nearly 5.6 million Farm Bureau members.

 

 

 

 





75 Applewood Drive, Suite A
P.O. Box 128
Sparta, MI 49345
616.887.9008
Get one year of Fruit Growers News in both print and digital editions for only $15.50.

Interested in reading the print edition of Fruit Growers News?

Subscribe Today »


Be sure to check out our sister sites:
produceprocessingsm
website development by deyo designs