The National Association of Wheat Growers (NAWG) and U.S. Wheat Associates (USW) are pleased that the Obama Administration submitted implementing legislation for pending free trade agreements (FTAs) with Colombia, Panama and South Korea on Monday.
The U.S. wheat industry strongly supports these bilateral agreements as critical steps toward competing on a level playing field in the global wheat market, and now urges Congress to pass them as quickly as possible.
The Colombia agreement, in particular, is vital to the wheat industry’s efforts to maintain market share in what has traditionally been the largest market for U.S. wheat in South America.
Under trade agreements with Canada and Argentina, wheat from these origins enters Colombia duty free while U.S. wheat faces a 10 percent tariff. Colombian buyers want to import U.S. wheat, but they do not want to pay the extra cost associated with the tariff. U.S. wheat sales to Colombia have dropped 20 percent since June alone, a rate of loss that is likely to grow now that an FTA between Canada and Colombia is in place. In fact, USW estimates that U.S. wheat growers could lose at least $100 million in sales in this competitive market every year.
“We know there is strong support for these trade agreements on both sides of the aisle and in both Congressional chambers,” said Wayne Hurst, NAWG president and a wheat farmer from Burley, Idaho. “We want Members to work day and night until these agreements are done and duty free access is in place for our growers and exporters.”
“Our industry is uniquely trade-dependent, with about half of our production moving to export markets each year,” said Randy Suess, USW chairman and a wheat farmer from Colfax, Wash. “Not long ago we supplied 70 percent of Colombia’s wheat imports so we know we can compete there. It is very frustrating that the delay in ratifying this agreement that was signed in 2006 is now costing us sales every day.”
The U.S. is the world’s largest wheat exporter, offering customers around the globe a reliable, high-quality supply of all six wheat classes. In the 2010/2011 marketing year, ended May 31, 2011, the U.S. exported nearly 1.3 billion bushels of wheat valued at $10.3 billion, supporting thousands of jobs and economic benefits across the country. U.S. wheat is also a common component in U.S. food aid efforts.
Melissa George Kessler, NAWG, mkessler (at) wheatworld.org
Steve Mercer, U.S. Wheat, smercer (at) uswheat.org