Source: Rita Jane Gabbett, MEATINGPLACE, 10/1/18


One thing the meat industry wanted in a renegotiated North American Free Trade Agreement was: nothing. The industry wanted already trade-friendly terms for U.S. meat exports to remain in place. Last night’s announcement that Canada had agreed to what will now be called the United States Mexico Canada Agreement (USMCA) did just that for beef and pork producers.

“Under NAFTA, U.S. meat and poultry exports to Mexico and Canada have thrived as import duties were removed and non-scientific barriers to trade have been significantly reduced,” said Meat Institute President and CEO Julie Anna Potts. “The North American market for the meat and poultry industry is nearly completely integrated and is essential to its long-term viability. The agreement submitted today to Congress safeguards the core tenets of NAFTA that have strengthened the U.S. meat sector and overall economy.”

"Over the past quarter century, free and open trade between the United States, Mexico, and Canada has been tremendously successful for our producers, and we’re pleased that we’ll be able to maintain our existing market access," said National Cattlemen's Beef Association President Kevin Kester.

“We thank the administration for its diligent work to complete recent agreements that maintain zero-tariff access to three of U.S. pork’s top five markets,” said National Pork Producers Council President Jim Heimerl. “The three-way pact with Mexico and Canada, our largest and fourth-largest export markets, respectively, and the recently signed agreement with Korea represent welcome momentum during what has been a challenging year.”

Last night’s announcement follows last week’s signing of a modernized free trade agreement with South Korea that also retained the zero-tariff access to U.S. pork’s fifth largest export market.

Both new trade pacts fulfilled promises President Donald Trump made to re-negotiate trade agreements with key trading partners.

Poultry
While beef and pork trade terms with Canada remained largely unchanged, the new pact did include some references to poultry trade, including the following language:
• "Canada shall notify the United States of any change to Canada’s Schedule to the Customs Tariff that increases the customs duty applied to a dairy, poultry or egg product when imported into Canada from the United States prior to finalization of such change.”
• "On the request of the other Party, a Party shall meet to discuss any measures or policies that may affect trade between the Parties of a sugar, SCP, dairy, poultry or egg product within 30 days of the request.”
• "Canada shall ensure that imports of dairy, poultry or egg products eligible for Canada’s Duties Relief Program (“DRP”) and Import for Re-export Program (“IREP”) as of September 1, 2018, continue to be eligible for these programs, as well as any subsequent or successor programs to DRP and IREP, as long as Canada maintains such programs."

A National Chicken Council spokesman told Meatingplace the group is still reviewing the details of the pact.

Dairy
One of the largest sticking points for the United States with Canada was dairy trade. The newly negotiated USMCA would eliminate Canada’s Class 7 dairy price system and afford greater U.S. access to Canada’s dairy market.
“The American Dairy Coalition applauds President Donald Trump and U.S. Trade Representative Robert Lighthizer for their continued diligence and determination in reaching a fair and updated trade deal,” the group said in a statement.

Next steps
After a 60-day review period, leaders of the three countries can sign the pact; then Congress must vote to approve it next year.
The outcome of the midterm elections could impact the vote, particularly if the Democrats retake the House of Representatives.  

"The bar for supporting a new NAFTA will be high," Rep. Richard Neal (D-Mass.) said in a statement, according to POLITICO. Neal is the ranking member of the House Ways and Means Committee.

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