U.S. agriculture will be better off with the Trans-Pacific Partnership (TPP) agreement than without, a USDA economist told attendees at the 2016 Legislative Agriculture Chairs Summit in Denver.
The summit, facilitated by the State Ag and Rural Leaders (SARL) group, annually brings together influential legislators to discuss agriculture and rural policy. AEM is an event sponsor.
Jason Hafemeister, trade policy coordinator with the Foreign Agricultural Service of the U.S. Department of Agriculture, said the TPP is important for both commercial and strategic reasons. First, it opens important markets (such as Japan) and second, it increases U.S. leverage in other negotiations.
Hafemeister noted that exports are a critical source of income for a wide range of agricultural products. For example, he said, U.S. producers export more than 40 percent of the grapes, about 50 percent of the soybeans, rice and wheat, and more than 80 percent of the cotton that they grow. These exports support higher prices and help expand production, he said.
While the U.S. is also a big importer of agricultural products, most imports are complementary and several sectors, such as corn, tree nuts, wheat, dairy, cotton, pork and poultry, have large trade surpluses, he said.
“Trade is an important element of U.S. and global economic growth, creating demand for farm products and supporting farm income,” Hafemeister said. “Trade agreements expand purchasing power for our customers and remove barriers to our exports.”
The agreement still needs to be finalized and sent to Congress for approval.
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Click here to view Jason Hafemeister’s complete presentation.