The American Soybean Association (ASA) and the National Corn Growers Association (NCGA) are celebrating Congressional passage of the U.S. Free Trade Agreements (FTAs) with South Korea, Colombia and Panama that represent nearly $3 billion of additional agriculture exports to these trading partners. ASA applauds President Barack Obama and Congress for working together to reach a final vote and urges the Administration to ensure that these FTAs enter into force by Jan. 1, 2012.
“The three free trade agreements with Korea, Colombia and Panama provide great opportunities for America’s farmers,” NCGA President Garry Niemeyer, a corn farmer from Auburn, IL, says. “Passage by Congress ensures our industry continues to lead the nation in economic growth and international competitiveness. In addition, this action shows members of Congress understand the importance of the FTAs to rural America.”
ASA President Alan Kemper, a soybean producer from Lafayette, IN adds that, “Increased exports of U.S. soy and soy fed meat and poultry will benefit soybean farmers and rural economies. After nearly five years of delays and loss of U.S. market share, soybean farmers look forward to realizing the opportunities these FTAs provide for America’s economic growth.”
Statistics show passage of the three FTAs could create 250,000 American jobs and add an additional $13 billion annually in exports.
The Korea FTA offers immediate duty-free access to U.S. soybeans for crushing and to U.S. soybean meal. It also opens up South Korea’s food-grade soybean imports to the private sector. The agreement will increase exports of the major grain, oilseed, fiber, fruit and vegetable, and livestock products by $1.8 billion annually, according to economic forecasts by the American Farm Bureau Federation.
Since the EU-Korea trade agreement went into effect July 1, European exports to Korea have increased 36% from a year earlier. U.S. farmers have already lost more than $1 billion in sales to Colombia in the two years since that country implemented a trade deal with Argentina and Brazil. The Colombia-Canada Free Trade Agreement that took effect Aug. 15 has also put U.S. workers and farmers at a disadvantage.
The Colombia FTA will create new opportunities for U.S. soybean farmers in the Colombian market by immediately eliminating tariffs ranging from 5-20% on soybeans, soybean meal and soybean flour, and phasing-out the 24% tariffs for crude soybean oil and refined soybean oil over five years.
“Most exports from Colombia already enter the U.S. duty-free, and this FTA will correct the current tariff imbalance in agricultural trade between our countries,” Kemper says.
The Panama FTA will benefit soybean farmers by immediately removing the tariffs on U.S. soybeans, soybean meal, and crude vegetable oils.
“Prior to Congress’ passage of the FTAs, farmers watched as other nations received access to markets over the U.S.,” Niemeyer says. “We need to keep and create jobs in America. The FTAs will help us achieve that.”