America’s Top (Ag) Export
U.S. growers want to open more markets to soybeans
It’s the time of year when U.S. soybean growers are asked to send in samples to provide a preview of new-crop soybean quality for international purchasers. Growers underwrite the cost of the annual quality survey with the “soybean checkoff,” an assessment of one-half to one full percentage point of the net market price for soybeans paid by all producers who market the staple (unless they’re organic farmers). Coordinated by the U.S. Soybean Export Council, the survey’s samples are the basis for the annual U.S. Soybean Crop Quality report and conferences presented in China, Japan, Taiwan, and Korea.
For the U.S. soybean industry, overseas markets are crucial: more than half of annual production is exported. Crucial for the U.S. economy, too. With overseas sales of over $21 billion in 2009, soybeans are the top U.S. agricultural export and support some 168,000 U.S. jobs and $29.4 billion in domestic economic activity (based on the Department of Agriculture estimate of $1 billion exports = 8,000 jobs and $1.4 billion in activity). Which is why the industry is pushing for trade liberalization – starting with congressional approval of the pending Free Trade Agreements (FTAs) between the U.S. and Colombia, South Korea, and Panama.
In testimony before the Senate Committee on Agriculture August 4, Danny Murphy, vice president of the American Soybean Association (ASA), said that the delay in approving the Colombia FTA has caused the U.S. to lose over 50% of its market share for soybean meal. (Indeed, Datamyne Colombian import data shows a decline in U.S. share of all soybeans sold to that country from 91% in 2008 to 65% in 2009, with Argentina the biggest gainer, followed by Bolivia.)
The ASA also calls for normalization of financial relations with Cuba. U.S. suppliers can reach the three major Cuban ports of Cienfuegos, Havana, and Matanzas in a matter of one day or less, the trade group says, much faster than their competitors in Brazil. But consideration of enabling legislation – the Travel Restriction Reform and Export Enhancement Act (H.R. 4645) – was postponed September 30, to be taken up, along with other trade issues, after November’s elections.
Date posted: October 1, 2010