General reaction to progress on the United States-Mexico-Canada Agreement (USMCA) is nothing but positive at this point from nearly all sectors of U.S. agriculture. Calling it a “hard-fought win” the American Farm Bureau Federation commended the Trump administration for their efforts to solidify the trading relationships we have with our North American neighbors.
“Farm Bureau will review the details of the new treaty as they become available, but the elimination of Canada’s Class 7 dairy pricing program is a clear victory for our farmers,” said American Farm Bureau Federation President Zippy Duvall. “We also now have access to an additional 3.6 percent of Canada’s dairy market, which is even better than what we would have achieved under TPP.”
According to Duvall, maintaining trade with our two closest neighbors – Mexico and Canada is critical to U.S. agriculture and that USMCA will build on the success of the North American Free Trade Agreement.
“Mexico, is still an $18 billion market for U.S. ag products,” Duvall said. “The USMCA includes new provisions to provide science-based trading standards, timely review of products produced through biotechnology and gene editing and new provisions on geographic indications.”
According to the American Farm Bureau Federation USMCA will:
- Provide new market access for dairy and poultry products and maintains the zero-tariff platform on all other ag products.
- Benefit dairy farmers, in particular, because it eliminates aspects of Canada’s dairy program (Classes 6 and 7) that had been used to undercut U.S. sales of dried milk products. Under the agreement, U.S. dairy products gain access to an additional 3.6 percent of Canada’s dairy market.
- Also include important provisions surrounding geographic indication standards in Mexico that will help ensure that U.S. products do not face restrictions due to the mere use of common names.
- Provide key reforms in other areas to build on Mexico’s current profile of being an $18 billion market for U.S. ag products.
- Include, for the first time, measures that address cooperation, information sharing and other trade rules among the three nations related to agricultural biotechnology and gene editing.
- Include provisions to reduce trade-distorting policies, increase transparency and ensure non-discriminatory treatment of ag products among the three nations.
- Require Canada to grade imports of U.S. wheat in a manner no less favorable than their own. And Mexico and the United States agreed that all grading standards for ag products will be non-discriminatory.
- Include provisions that enhance science-based trading standards among the three nations as the basis for sanitary and phytosanitary measures for ag products, as well as progress in the area of geographic indications.
- Be in effect for sixteen years, with a review after six years to determine if the agreement should be extended another sixteen years. This is in place of the five-year sunset proposal, which could have been very disruptive to long-term planning.