US cattleman urges action on FTAs as competitors vie for overseas markets

The US agricultural sector pressed its case for ratification of pending free trade agreements with Colombia, Panama and South Korea before the US House of Representatives Committee on Agriculture May 12.

US Trade Representative Ron Kirk and Dept. of Agriculture Secretary Tom Vilsack testified on the critical role of the agricultural sector in achieving President Obama’s goal of doubling exports over the five-year period ending in 2014. In FY 2010, US farm product exports neared a total of $109 billion; the ag trade surplus was almost $34 billion. The Panamanian FTA is projected to generate an additional $46 million in US agricultural exports, the Colombian FTA an added $370 million, and the South Korean agreement over $1.9 billion, according to USDA Economic Research Service (ERS) figures.

Representative of the National Association of Wheat Growers, National Corn Growers  Association, National Pork Producers Council, National Farmers Union, and American Farm Bureau Federation gave testimony as well. (You can read their testimony here.)

Bill Donald, president of the National Cattlemen’s Association and a cattle rancher for 40 years, stressed the urgent need to lower trade barriers to American beef, even as demand for beef grows  as developing economies prosper around the world. He assessed the competition from the EU, Australia, Canada, Argentina, and Brazil.

For example, Canada and Mexico are each pursuing trade agreements with Colombia, where US beef imports are now subject to tariffs as high as 80%.  The US-Colombian FTA would not only eliminate tariffs, but assure Colombia’s adherence to World Organization for Animal Health guidelines on bovine spongiform encephalopathy (BSE) or “mad cow” disease. The last is especially critical. According to Cattlefax, the US beef industry has lost nearly $22 billion in sales to BSE restrictions, many unwarranted by accepted scientific standards.

We took a look at the Datamyne trade data on Colombian beef imports 2008-2010 and it certainly looks like a market in play. Bolivia, a ranking supplier of beef to Colombia in 2008, curtailed its exports after an outbreak of hoof-and-mouth disease.

Paraguay’s substantial share is largely accounted for by shipments from Bertin Paraguay S.A., an examination of the underlying records shows. Bertin became part of JBS S.A. Group in 2009. Brazil’s JBS is the world’s largest meat processor.

Uruguay’s rapid rise from no share to 4% of the Colombian imported beef market is part of a bigger story. As reported by the Financial Times in May, Uruguay has overtaken Argentina in total beef exports.

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