Page 22 - Export or Bust eBook

During the TPP negotiations, “I frequently heard from Washington’s agriculture community about
the benefits of lower tariffs in Japan and Vietnam, in particular, because we would have access to
markets without prohibitively high tariffs. For wheat, beef, dairy, potatoes, and wine, Japan is a
top market,” he said.

A lot of Washington State frozen french fries go to Japan, Reichert reports, and, “for Washington’s
apple, pear, and cherry growers, Vietnam is an important market where they would have benefited from
the removal of Vietnam’s 10 percent tariff on produce.”

Now, unfortunately, he said, “because of the completed CPTPP and other trade agreements already in
place that do not include the U.S., our producers are falling behind competitors like the European Union
(EU), Canada, and Australia. Our producers continue to face tariffs in countries like Japan, but our
competitors enjoy duty-free access to this critical market. Our potato growers estimate a loss of
$100 million in export sales to Japan as a result of the CPTPP.”

“This is why I will continue to urge the administration to consider the cost of inaction and to work
instead to open new markets,” Reichert said.

At this point, Vetter says, she is “not sure there is a lot of appetite” among CPTPP partners for another
go at U.S. membership. Still, she sees U.S. re-entry as quite possible, noting that the agreement won’t be
implemented for a while. Fortunately, from the prospective of American farmers, she says, while the
CPTPP countries dropped some provisions that the U.S. valued in the TPP, “they have accepted almost
the entirety of the agricultural package – not only the level of market access, but strong and more
comprehensive rules on SPS (sanitary and phytosanitary) measures.”

New tires on NAFTA

On Trump’s orders, meanwhile, U.S. negotiators are trying to update NAFTA and renegotiate better
terms of what Trump has called “the worst trade deal in history.” Fixes may include some farm-friendly
ones, such as improved access to Canada for U.S. milk, wheat, poultry and eggs. Trade officials say they
hope to finish the task soon, but have yet to finish the process.

Total U.S. agricultural trade with Mexico and Canada has grown about 425 percent (U.S. farm exports
up 340 percent; imports, up 530 percent) in dollar value since the pact was approved nearly a quarter
century ago. USDA officials say that Trump agrees U.S. agriculture has benefitted greatly from it, yet he
still threatens to pull the U.S. out of NAFTA if he isn’t satisfied with the remake.

At the same time, even though President Trump has raged against NAFTA, calling it “horrible” and "the
worst trade deal in history," USDA Deputy Secretary Steve Censky says the president’s anger about
the North American pact is focused on non-food manufacturing sectors. “We want to be sure we
do no harm (to agricultural trade),” he said.

Duvall, of AFBF, recited the U.S. farmers’ mantra these days on NAFTA when he told Agri-Pulse,
“they’re reworking it (and) we’re hoping they’re not going to do any harm to the agricultural piece of
it.” His tracking of progress led him to say, “We’re encouraged we’re going to be OK there.”

Dan Halstrom, a senior vice president with the U.S. Meat Export Federation, for example, notes that
Mexico and Canada “claim 30 to 40 percent of our meat exports,” and “retaining the zero percent tariff
(under NAFTA) is a must.”

20 www.Agri-Pulse.com