Milling & Baking News - June 20, 2017 - 40

Washington X

Kansas wheat group requests no
changes to NAFTA ag provisions
WASHINGTON - The Kansas Association of Wheat Growers, which depends
on exports to Mexico, wants the U.S. government to avoid any renegotiations on
agricultural trade provisions in the North
American Free Trade Agreement (NAFTA), according to public comments sent
to the U.S. Trade Representative.
Public comments from the American
Soybean Association and the American
Feed Industry Association said any renegotiation of NAFTA should include focusing on maintaining strong trade relationships and strengthening sanitary and
phytosanitary regulations.
The Sweetener Users Association seeks
a separate tariff-rate quota in NAFTA to
compensate for a sweetener suspension
agreement reached in principle June 6 by
the United States and Mexico.
The Trump administration on May 18
notified Congress that it intended to renegotiate NAFTA. A posting in the May 23
issue of the Federal Register said the U.S.
Trade Representative would accept public
comments until June 12 and that a hearing
would take place in Washington on June 27.
NAFTA is a multi-layer free trade
agreement between the United States,
Canada and Mexico that came into effect

market, and the U.S. has already lost some
market share since the Mexican government has entered into free trade agreements with other countries. "
Costs for U.S. wheat would
d
rise if a new NAFTA agreement leads to any kind of
tariffs or other trade barriers,
the K.A.W.G. said.
"At a time when wheat
farmers are facing tough prices and a tough ag economy,
losing Mexico would have dii
sastrous implications for an already
dire situation for Kansas farmers," the
K.A.W.G. said. "Please do not renegotiate
any of the agricultural trade provisions in
NAFTA."
More than 800 members fund the
K.A.W.G., which is based in Manhattan,
Kas., and works in such areas as farm
policy, trade, environmental regulation,
agricultural research and stability.
The American Soybean Association, St.
Louis, uderscored the importance of maintaining and building on the extensive agricultural trade relationships that have developed between the United States, Canada and Mexico through NAFTA. The association in its comments listed benchmarks

'At a time when wheat farmers are facing tough prices and
a tough ag economy, losing Mexico would have disastrous
implications for an already dire situation for Kansas farmers.
Please do not renegotiate any of the agricultural trade
provisions in NAFTA.'
- Kansas Association of Wheat Growers
in 1994. It was designed to remove tariff
barriers and facilitate the cross-border
movement of goods and services among
the three countries. There has been controversy over the effectiveness of the
agreement in ongoing discussions of potential renegotiations.
Tariffs on U.S. wheat imports into Mexico dropped to zero when NAFTA went
into effect on Jan. 1, 1994, the Kansas Association of Wheat Growers said in its
comments. Exports to Mexico were 400%
higher in the 10 years after NAFTA than
the 10 years prior to NAFTA.
"With U.S. wheat farmers facing financial hurdles, open access to the Mexican
market is needed now more than ever,"
the K.A.W.G. said in its comments. "Mexico is crucial for American wheat farmers,
but our Mexican customers have opportunities to take their business elsewhere.
Mexico is already a fiercely competitive
40 / June 20, 2017 XMilling & Baking News

that reflect the gains already achieved in
increasing U.S. agricultural exports to its
NAFTA trading partners and called on
the U.S.T.R. to preserve if not exceed them
in the renegotiation. These include maintaining a comprehensive, rules-based approach and ensuring no backsliding by
any party on agriculture or non-agriculture market access commitments.
Phytosanitary concerns
The A.S.A. urged the U.S.T.R. to pursue stronger language on sanitary and
phytosanitary standards (SPS) geared
toward enhancing cooperation between
regulatory agencies and avoiding trade
disruptions related to agricultural production technologies. The A.S.A. included suggestions to adopt trade-facilitative
residue levels and adventitious presence mechanisms, and to establish in the
renegotiation a long-term and formal

low-level presence policy for biotech trait
shipments between the three countries.
Beyond its specific recommendations,
the A.S.A. cited the growth of the Canadian and Mexican markets for U.S.
soybeans, and for American agricultural
products overall, since the implementation of NAFTA. In 2015, the United
States exported $438 million
S
in soy products to Canada, a
220% increase from the $199
million sold in 1987. Soy
exports to Mexico in 2015
totaled $2.44 billion, nearly
500% greater than the $489
million sold in 1993.
The American Feed Industry
Association, Arlington, Va., said in
its comments that there is a strong need
to reinforce NAFTA treaty commitments,
enforce its trade laws and improve conditions for competition and trade. The
A.F.I.A. also agrees there are opportunities to improve NAFTA, such as in the
areas of sanitary and phytosanitary measures, adopting consistent standards for
animal health certification, and other
technical barriers to trade such as regulatory cooperation.
A separate sweetener quota?
Members in the Sweetener Users Association, Washington, are food and beverage companies that use sugar, high-fructose corn syrup and other caloric sweeteners in manufacturing their products. The
association in its comments said the U.S.Mexico suspension agreements involving sweeteners have been detrimental to
industrial users of sugar and that NAFTA
should have a separate tariff-rate quota to
which reference prices do not apply.
"Although we oppose new quotas
generally, the terms of the recently announced modifications to the 2014 suspension agreements appear to be so
onerous for industrial sugar users, such
that some relief is urgently required," the
association said. "Therefore, we recommend the establishment of a permanent
T.R.Q. (tariff-rate quota) for Mexico of
approximately 300,000 S.T.R.V., which
would be exempt from reference prices in
the suspension agreements."
The Sweetener Users Association also
said in its comments that modest additional amounts of sugar from Canada
and other origins could be accommodated without damaging the U.S. sugar
policy regime. The value of U.S. sweetener exports at $6.35 billion exceeded the
value of sweetener imports from Mexico
at $6.22 billion from 2007-2016, the Sweetener Users Association said in citing data
from the economic consulting firm Agralytica. MBN
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Milling & Baking News - June 20, 2017

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