Commodity groups pleased with proposed Japan deal

Commodity groups are celebrating this weekend’s trade agreement in principle with Japan. The bi-lateral proposed deal will offset the competitive disadvantage U.S. wheat producers have with Australia and Canada, according to Josh Tonsager, vice president of policy and communications for the National Association of Wheat Growers.

“We’re anticipating and hopeful that this agreement announced yesterday will put us back onto a level playing field with those competitors,” Tonsager told Brownfield Ag News Monday, “especially as Japan has consistently been a top one or two market for U.S. wheat.”

Iowa State University economist Dermot Hayes estimates the potential agreement will result in U.S. pork exports to Japan growing from $1.6 billion in 2018 to more than $2.2 billion over the next 15 years.

“We look forward to rapid implementation of the agreement as international competitors are currently taking U.S. pork market share through more favorable access,” said David Herring, a pork producer from Lillington, North Carolina, and president of the National Pork Producers Council, “[U.S. pork] is the preference of many Japanese customers and we look forward to competing on a level playing field again.”

If implemented, the agreement gradually cuts Japan’s tariffs on U.S. beef from the current 38.5 percent down to 9 percent. Japan’s $2 billion in 2018 beef purchases from the U.S. accounted for about a quarter of U.S. beef exports.

“Today is an exciting day for America’s cattlemen and cattlewomen,” said Jennifer Houston, president of the National Cattlemen’s Beef Association, referring to the potential deal that would increase U.S. cattlemen’s market access to Japan.

During the trade war with China, the American Soybean Association (ASA) has said that they would like the administration to work on existing and new free trade agreements.

“We are definitely pleased to hear that the President and his team have heard ASA and other farm groups by working on this deal,” said Davie Stephens, president of the ASA. “Along with more stability for soybean exports to Japan, this FTA also brings potential to increase pork and beef exports; a value-add opportunity for soybeans and way to create more jobs here in the U.S.”

The agreement in principle was announced in France at the G7 summit.

AUDIO: Josh Tonsager

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