Instead of working his fields in northeastern Montana, wheat farmer Gordon Stoner was in Washington, D.C. this week to testify before Congress – twice – on the significance to his business and the U.S. wheat industry of pending free trade agreements with Colombia, Panama and South Korea.
Wednesday morning, Stoner testified to the Senate Finance Committee on the importance of the pending agreement with Colombia, and on Thursday he spoke to the House Agriculture Committee on the need for immediate ratification of all three agreements to bolster American agriculture.
“I am here today instead of at home working my fields because I know the viability of our industry depends on our ability to export U.S. wheat…to every market in the world,” Stoner said to Members.
Stoner is a fourth-generation farmer and rancher from Outlook, Mont., where he grows durum wheat, peas and lentils in addition to raising cattle. He is president of the Montana Grain Growers Association, a member of the NAWG Board of Directors and vice chairman of the NAWG and U.S. Wheat Associates Joint International Trade Policy Committee.
At the hearings, he repeated calls from the industry for the Obama Administration to prepare and submit the three free trade agreements to Congress for a ratification vote as soon as possible.
All three countries with currently pending free trade agreements are important customers of U.S. wheat growers. Last year, the United States exported 645,000 metric tons (MT) of wheat to Colombia, 123,000 MT to Panama and 1.1 million MT to South Korea. At today’s export prices, that wheat represents about $650 million in export sales.
But without the pending free trade agreements in place, U.S. wheat producers will lose market share in these countries. Competitors including Australia, Canada, the European Union and Argentina have already concluded agreements or are negotiating their own bilateral agreements, which will effectively shut the United States out of wheat markets in some cases.
For example, when the Colombia-Canada FTA becomes effective this summer, millers that would prefer to use U.S. wheat will have to turn to cheaper, duty-free wheat from Canada. The tariff disadvantage would result in a more than $100 million per year loss to U.S. wheat farmers.
Nearly 80 percent of the wheat produced in Stoner’s home state of Montana is exported. Overall, the United States exports about half of total wheat production each year. For the 2010/2011 marketing year, USDA indicates exports will be 34.7 million metric tons (MMT), representing 58 percent of U.S. production and 28 percent of wheat traded internationally.
In recent weeks, the Administration and Congress have given positive signals about the possibility for movement on the agreements in the coming months.
However, Administration witnesses at this week’s hearings would not be pinned down on a specific deadline by which the President would submit the agreements to Congress, and they emphasized the importance of moving Trade Adjustment Assistance (TAA) and other trade-related priorities with the agreements.
For more about the three agreements, visit www.wheatworld.org/trade.