Trump leaves TPP; some ag groups upset
President Donald Trump signed an executive order today to withdraw from the Trans Pacific Partnership agreement and says he intends to begin renegotiating the North American Free Trade Agreement with Canada and Mexico.
Trump has scheduled a meeting with Mexican President Enrique Peña Nietoon January 31, and also plans to meet with Canadian Prime Minister Justin Trudeau to discuss NAFTA.
British Prime Minister Theresa May is scheduled to visit the White House on Friday. Trump will presumably discuss with her a trade agreement with the United Kingdom following its vote to exit from the European Union.
American Soybean Association President Ron Moore urged the Trump administration to immediately announce how it intends to engage and expand market access in the Asia-Pacific region.
“Trade is something soybean farmers take very seriously. We export more than half the soy we grow here in the United States, and still more in the form of meat and other products that are produced with our meal and oil,” said Moore, who farms in Roseville, Ill. “The TPP held great promise for us, and has been a key priority for several years now. We’re very disappointed to see the withdrawal today.”
“Moving forward, we expect to see a plan in place as soon as possible to engage the TPP partner nations and capture the value that we lose with the withdrawal today,” Moore said.
“With net farm income down by over 40 percent from levels just a few years ago, we need trade deals with the Asia-Pacific countries to make up for the $4.4 billion in annual net farm income being lost by farmers from not moving forward with the TPP.
“Also, we expect a seat at the table to help ensure these agreements in whatever form they take are crafted to capture their full value for soybean farmers,“ added Moore. “Trade is too important for us to support anything less.”
National Cattlemen’s Beef Association President Tracy Brunner said, “TPP and NAFTA have long been convenient political punching bags, but the reality is that foreign trade has been one of the greatest success stories in the long history of the U.S. beef industry.”
“Fact is, American cattle producers are already losing out on $400,000 in sales every day because we don’t have TPP,” Brunner said, “and since NAFTA was implemented, exports of American-produced beef to Mexico have grown by more than 750 percent. We’re especially concerned that the administration is taking these actions without any meaningful alternatives in place that would compensate for the tremendous loss that cattle producers will face without TPP or NAFTA.”
“Sparking a trade war with Canada, Mexico, and Asia will only lead to higher prices for American-produced beef in those markets and put our American producers at a much steeper competitive disadvantage,” Brunner said.
“The fact remains that 96 percent of the world’s consumers live outside the United States, and expanding access to those consumers is the single best thing we can do to help American cattle-producing families be more successful.”
American Farm Bureau Federation President Zippy Duvall said, “While President Trump signed an executive order today withdrawing our nation from the Trans- Pacific Partnership, we viewed TPP as a positive agreement for agriculture — one that would have added $4.4 billion annually to our struggling agriculture economy. With this decision, it is critical that the new administration begin work immediately to do all it can to develop new markets for U.S. agricultural goods and to protect and advance U.S. agricultural interests in the critical Asia-Pacific region.
“American agriculture is virtually always a winner when trade agreements remove barriers to U.S. crop and livestock exports because we impose very few compared to other nations,” Duvall said.
“We have much to gain through strong trade agreements. AFBF pledges to work with the administration to help ensure that American agriculture can compete on a level playing field in markets around the world. But we need the administration’s commitment to ensuring we do not lose the ground gained — whether in the Asia-Pacific, North America, Europe or other parts of the world.
“This is why we believe it is also important to re-emphasize the provisions of the North American Free Trade Agreement with Canada and Mexico that have been beneficial for American agriculture. U.S. agricultural exports to Canada and Mexico have quadrupled from $8.9 billion in 1993 to over $38 billion today, due in large part to NAFTA.
“Any renegotiation of NAFTA must recognize the gains achieved by American agriculture and assure that U.S. ag trade with Canada and Mexico remains strong,” Duvall said. “AFBF will work with the administration to remove remaining barriers that hamstring the ability of America’s farmers and ranchers to benefit from trading relationships with our important North American trading partners.”
The American Feed Industry Association took a stronger position, issuing a news release that it “condemns Trump’s first trade decision.”
“TPP, and agreements like it, are key to setting the terms and rules for future trade relationships, creating higher standards and expectations than previous trade deals,” said AFIA President and CEO Joel G. Newman.
“While the U.S. economy generally deals with a trade deficit, agriculture is the one segment where our country enjoys a strong trade surplus,” Newman said.
“TPP was intended to assist the U.S. in setting a global trade agenda, addressing international competition and combating continued market share losses in the region,” said Newman. “Without TPP, the U.S. feed industry will lose more than the opportunities provided by tariff reductions. We will lose the opportunity to facilitate new trade relationships by addressing larger sanitary and phytosanitary issues, environmental protections, domestic job creation and regulatory cooperation.
“As President Trump further assesses U.S. trade relations in the Pacific Rim and any potential trade agreements going forward, we hope components of TPP beneficial to our industry will be preserved. Our industry is proud of its ability to create safe, innovative feed, feed ingredients and pet food supply for the world, and looks forward to working with the new administration to advance our economic interests in this critical region.”
–The Hagstrom Report
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