Beef, pork groups press US to approve three FTAs

by Meat&Poultry Staff
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WASHINGTON – Considering the month of May is both World Trade Month and National Beef Month, both events inspired the National Cattlemen’s Beef Association (NCBA) to write three letters to President Obama, members of the US Senate and the US. House of Representatives urging them to speed up the process of approving three pending free-trade agreements with South Korea, Panama and Colombia so they can be implemented.

Likewise, the National Pork Producers Council and 39 state pork associations also sent letters to Republican and Democrat leaders in the Senate and House urged them to approve these pending free-trade agreements. They asked them to vote on FTAs with Colombia, Panama and South Korea as soon as possible after receiving [from the White House] the enabling legislation.

“The US can’t wait any longer to implement the trade pacts,” said NCBA President Bill Donald.

“Each day that goes by without implementing these agreements is another day we risk losing American jobs by losing market share to other countries,” Donald said. “With 96 percent of the world’s consumers living outside of the US, future growth of the US economy depends upon our ability to produce and sell products competitively in the global marketplace.”

All cuts of US beef exported to Korea are charged a 40 percent tariff, resulting in more than $200 million in tariffs in 2010, according to Donald. The Korea-US trade agreement would phase out South Korea’s 40 percent tariff on beef imports, with $15 million in tariff benefits for beef in the first year of the agreement alone and about $325 million in tariff reductions annually once fully implemented.

Colombia places up to an 80 percent tariff on US beef imports, making it one of the highest tariffs US beef faces anywhere in the world, Donald said. Once the US-Colombia Trade Promotion Agreement is implemented, this agreement immediately provides duty-free access for high quality US beef and reduces tariffs on all other beef and beef products over 15 years.

The Panama Free-Trade Agreement would eliminate the 30 percent tariff on prime and choice cuts and duties on all other cuts would be phased out over 15 years. Once Congress approves these agreements, the US will ultimately have free trade for US beef with approximately two-thirds of the population in the Western Hemisphere, Donald said.

“For the US pork industry, the trade agreements with those countries will add significantly to producers’ bottom line and create thousands of pork industry jobs,” said NPPC President Doug Wolf. Once fully implemented, the three FTAs combined will generate more than $770 million in additional pork exports annually, causing live hog prices to increase by $11.35 and creating more than 10,200 direct pork industry jobs, according to Dermot Hayes, Iowa State University economist.

The US already has already lost sales in Colombia because of that country’s FTAs with other nations. Its share of the Colombian agricultural market has fallen to 27 percent in 2009 from 44 percent in 2007. Through its 2004 FTA with South Korea, Chile has increased its market share in the Asian nation because of its tariff advantage over other major pork exporting countries. Chile’s import tariffs on pork going to South Korea will go to zero by 2014.
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