Aug 1, 2018NPC: Trade talks ramp up
In addition to USDA announcing a $12 billion program to mitigate the effects of retaliatory tariffs, The National Potato Council (NPC) said several high-level negotiations were held in Washington D.C. recently with trading partners directly involved in the tariff retaliation issues.
On July 25, President Trump met with European Union President Jean-Claude Juncker and announced that an agreement had been struck between the two parties to reduce tariffs on key products including in the agricultural industry. However, a day later, representatives in Brussels walked back that statement and indicated agriculture would not be part of any future negotiations.
Additionally, Mexican officials were in D.C. working to accelerate talks on an enhanced agreement with the U.S. It has been suggested that if the NAFTA talks continue to stall, a bilateral agreement between Mexico and the U.S. could be established in its place. Canada has voiced its concerns about this outcome and has received assurances that the preference is to move forward first under the NAFTA framework.
More on the $12 billion to mitigate retaliatory tariffs
“This is a short-term solution to allow President Trump time to work on long-term trade deals to benefit agriculture and the entire U.S. economy,” Agriculture Secretary Sony Perdue said of the plan to mitigate damages to the agriculture industry as a result of retaliatory tariffs on American exports.
“The rapid roll-out of this program is an indication of how much pressure is on the administration to address the harm these tariffs can cause,” said NPC Executive Vice President and CEO John Keeling. “For potatoes, there are over $575 million in annual exports that are currently or potentially vulnerable to retaliation.”
According to the USDA, up to $12 billion in spending could be covered by the three parts of the program. Those three distinct activities are:
- Market Facilitation Program – to provide payments incrementally to producers of soybeans, sorghum, corn, wheat, cotton, dairy and hogs.
- Food Purchase and Distribution Program – to purchase surplus commodities such as fruits, nuts, rice, legumes, beef, pork and milk for distribution to food banks and other nutrition programs.
- Trade Promotion Program – cost share program to assist in developing new export markets.