In a few short weeks, the U.S. will be the only major wheat provider for Colombian buyers not benefiting from permanent zero duty access. This will cut significantly into wheat growers’ share of that large and growing market – hurting both U.S. producers and Colombian buyers of their products, says Wayne Hurst, president of the National Association of Wheat Growers (NAWG).
He commented on delays in the Columbian Free Trade Agreement (FTA) during a press roundtable held Friday by the National Foreign Trade Council (NFTC), which promotes the expansion of trade. The event also included comments from Ed Gresser, the director of ProgressiveEconomy; Nick Giordano, vice president and counsel for international affairs at the National Pork Producers Council; and Bill Lane, Washington director for governmental affairs at Caterpillar.
In his prepared statement, Hurst reiterated the wheat industry’s strong support for immediate passage of all three FTAs that are currently waiting to go before Congress: Panama, South Korea and Colombia.
Hurst says the most important of these to wheat exports is the agreement with Colombia, which imports 97% of its wheat needs.
Colombia has also routinely been the largest wheat export market in South American for U.S. wheat producers in recent years. However, U.S. wheat market share in Colombia has declined from a high of around 70% to about 45% in less than three years, particularly since Argentina gained preferential duties in 2006 and eliminated all duties in 2009 under the Mercosur agreement. Canada is poised to gain duty-free access later this summer when it implements its own FTA with Colombia, which will drop U.S. market share by an additional 50% or more, NAWG says.
“Delaying these free trade agreements isn’t just a political game, it’s messing with real lives, here and abroad,” says Hurst. “And, it’s doing harm that can’t be easily undone once Colombian millers switch preferences from our wheat to someone else’s.”
The export market development organization that works for U.S. wheat producers, U.S. Wheat Associates (USW), estimates that U.S. growers stand to lose up to $100 million in sales per year based on the delay in implementation of the Colombian FTA. Both NAWG and USW strongly support the pending free trade agreements and continue to push for their quick consideration.
Both groups joined more than 100 other organizations last week in writing President Obama and Congressional leaders to again urge quick passage of the measures. That letter and a newly-updated briefing paper about the effects of continued FTA delays to the wheat industry are online athttp://www.wheatworld.org/issues/trade/.