Apr 22, 2019
USMCA impact: U.S. agriculture exports to increase by 1.1%

The U.S. International Trade Commission issued a report on the likely economic impact of the pending U.S.-Mexico-Canada Agreement (USMCA). It found that the agreement will result in a modest overall increase in U.S. agricultural exports by 1.1% ($2.2 billion) when fully implemented.

“We shouldn’t be deterred by the relatively small anticipated gains in the USMCA vs. NAFTA,” said Kam Quarles, VP of Public Policy for the National Potato Council. “Right now, we do not receive the full benefits of NAFTA due to Mexico’s retaliatory tariffs.”

Mexico has retaliated against frozen fries due to U.S. steel and aluminum (Section 232) tariffs. This retaliation eliminated the 0% duty under NAFTA and replaced it with a 20% duty. It is estimated that the U.S. potato industry will lose $80 million in exports annually if this situation persists, with Canada and the European Union being the main beneficiaries.

“Passing the USMCA and removing Mexico’s retaliation must occur immediately to help us dig out of this hole,” Quarles said. “The cost of inaction is simply too great.”

This report was a required element in the process of sending the USMCA to Capitol Hill for ratification. It noted that “most trade in agricultural products between the United States, Canada, and Mexico is already duty free under NAFTA and would continue to be duty free under USMCA.”

NPC commends proposed Waters-of-the-U.S. changes

On April 15, the National Potato Council filed comments on the Trump Administration’s revised Waters-of-the-U.S. (WOTUS) rule. This new rulemaking seeks to replace the Obama Administration’s WOTUS rule that would have massively expanded the territory that is subject to regulation by the Clean Water Act.

NPC’s comments state that, “The proposed rule represents a solid effort to return to a sensible regulatory approach that can be a part of an effort to improve water quality in the United States. A more clearly defined and understandable regulatory approach coupled with public policies that are carried out with federal, state and local government working in partnership with farmers on working lands can be a difference maker.”

Originally, the Administration sought to simply revoke the prior Obama Administration WOTUS. However, subsequent court rulings prevented that action and required this new rulemaking.

— From the National Potato Council

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