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Serving: West
CFBF president Jamie Johansson Tim Hearden
California Farm Bureau Federation president Jamie Johansson speaks at a free-trade event in 2018. He says the recently agreed upon USMCA applies a scientific basis for sanitary and phytosanitary procedures.

Trade deals level the playing field for West's farms

Phase-one China agreement, USMCA establish ‘science-based’ sanitary and phytosanitary standards for U.S. exports, group leaders say

Recently announced trade deals with China, Japan, Mexico and Canada will level the playing field for growers in the West, partly by establishing “science-based” sanitary and phytosanitary standards for U.S. exports, agricultural group leaders say.

The Phase One agreement with China announced Dec. 13 will not only include substantial increases in agricultural purchases by the Asian nation, but also commitments to address non-tariff trade barriers, said Tom Nassif, Western Growers’ president and chief executive officer.

“Non-scientifically based sanitary and phytosanitary standards have been used too often to deny access of American product to the Chinese market, and we’ve long urged that this problem be resolved,” Nassif said.

Likewise, the U.S.-Mexico-Canada Agreement now before Congress will also strengthen science-based sanitary and phytosanitary measures while improving the flow of trade, the California Farm Bureau Federation notes.

It also contains provisions to benefit exports of processed fruits, milk and dairy products, beef, wine, poultry and eggs, and other products, according to the CFBF.

JOBS CREATED

Canada is the No. 2 market for California agricultural exports and Mexico is fifth. Combined farm exports to those two countries 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,” CFBF president Jamie Johansson said. “Those jobs will benefit rural and urban areas.”

Sanitary and phytosanitary (SPS) measures aim to protect human or animal life or health from contaminants and disease-causing organisms in incoming foods, the U.S. Trade Representative’s office explains.

But U.S. officials complain that governments often misuse SPS procedures to disguise measures that are discriminatory, unduly burdensome or not based on scientific evidence.

The SPS concessions amid the initial China deal and the recently achieved accord with congressional Democrats to advance the USMCA continue a string of apparent trade victories for American agriculture.

JAPAN DEAL

In November, the Lower House of Japan’s parliament signed off on a trade deal with the U.S. that cuts tariffs on farm and industrial products.

“Under this agreement we secured from Japan most of the agricultural market access that we forfeited when we lost” the Trans-Pacific Partnership, Wendy Cutler of the Asia Society Policy Institute recently told a U.S. Meat Export Federation conference in Tucson, Ariz., according to a news release.

She added the deal will get the U.S. “caught up” with the other TPP countries in terms of lowering tariff rates.

For its part, the USMCA is an improvement over its predecessor, the North American Free Trade Agreement, in that it will provide more access for U.S. exports of agricultural products, primarily dairy, economists Christos Makridis and Jon Hartley wrote in a recent Fox News op-ed.

Canada has agreed in the USMCA to limit the degree to which they continue to subsidize their own dairy farmers, Makridis and Hartley note. Dairy is California’s leading commodity, accounting for $6.37 billion of the state’s nearly $50 billion in overall farm receipts in 2018, according to the CDFA.

STRUCTURAL REFORMS

The China deal requires structural reforms and other changes in the Asian nation in the areas of intellectual property, technology transfer, agriculture, financial services and currency and foreign exchange, according to U.S. Trade Representative Robert Lighthizer.

As part of the agreement, China has committed to make additional purchases of U.S. goods and services; a dispute resolution system will be established; and the U.S. has agreed to significantly modify its Section 301 tariff actions.

Western Growers’ Nassif credits President Donald Trump for keeping his promise to “rebalance” the U.S.’ trading relationships.

“In the wake of the early harvest trade deal with Japan and the U.S.-Mexico-Canada Agreement, the phase one trade deal with China represents another encouraging step forward in the effort to level the playing field for American farmers in this important market,” Nassif said.

“While U.S. agriculture has borne the brunt of the trade war with China, many of our farmers understand that, at times, short-term pain must be endured to achieve long-term gains and appreciate the efforts of President Trump to offset the damages incurred by our industry through trade mitigation assistance programs,” he said.

“Nevertheless, no amount of government aid can make up for lost market shares or displacement by competing suppliers,” he said. “For this reason, we urge the administration to quickly finalize and implement this deal, bringing us one step closer to restoring market access and getting back to normal for American fruit, vegetable and tree nut producers.”

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