May 20, 2016TPP to benefit potato industry
The Trans-Pacific Partnership (TPP) agreement could have significant positive impacts on the potato industry, according to a recent U.S. International Trade Commission report.
The largest gains for U.S. exports, such as potatoes, are expected in Japan and Vietnam, the report found.
Here’s more from the Trans-Pacific Partnership Agreement: Likely Impact on the U.S. Economy and on Specific Industry Sectors report:
Certain processed potato products face high to moderate tariffs in Japan and Vietnam, and their eventual elimination would result in the expansion of U.S. exports for these products. U.S. annual exports of processed potato products were valued at more than $1.3 billion during 2013–15. A large subset of this category is frozen potatoes, including French fries, a sector in which the United States competes with the EU and Canada in global markets.
Tariffs on U.S. processed potatoes in TPP countries are primarily found in Japan and Vietnam. Japan presently places tariffs of 8.5 percent on frozen French fries and up to 20 percent on other dehydrated potato products. Japan’s TPP concessions for processed potatoes include full elimination in 11 years. Vietnam’s tariffs, which range from 18 to 24 percent, would also eventually be eliminated under TPP.
Representatives of the U.S. potato industry estimate that elimination of Japanese tariffs on French fries and dehydrated potatoes alone would increase the value of Japanese imports of each product by at least $10 million annually. In light of rising demand and TPP tariff elimination, overall U.S. exports of frozen French fries to Vietnam would reach $10 million (from a 2014 level of $3.75 million) within 5 years.
While the TPP would reduce already low tariffs on fresh potato exports, TPP has not resolved persisting SPS issues that limit U.S. exports of potatoes in several ways. Without the restrictions, representatives of the U.S. potato industry estimate that the total value of the sales in Japan’s fresh potato market (including fresh table stock and chipping potatoes) could increase by $10 million the first year and $50 million in three years.
