Upon implementation of the U.S.–Peru Free Trade Agreement (FTA), the National Corn Growers Association (NCGA) notes corn growers will see an immediate benefit by having market access for 500,000 metric tons of corn with no tariff, giving the U.S. a significant competitive advantage over Argentina, which has been the primary supplier of corn.
NCGA, along with more than 40 other commodity and business organizations supporting the agreement, is urging Congress to approve the trade pact, which was signed by the two countries in December. “Trade pacts like the U.S.-Peru FTA will benefit all of agriculture and give corn growers increased market access to the Peru,” says NCGA President Gerald Tumbleson. “Market access is vital to our industry. Once this trade pact is approved by Congress, the United States will be a significant supplier of corn to Peru instead of a residual supplier.”
According to the U.S. Trade Representative, the U.S. is Peru’s fourth largest supplier of consumer-oriented food imports. From 2000-2004, the U.S. exported to Peru an average of $227 million in agricultural products – and $20 million in feed grains. By the end of the full implementation period of the agreement in 2025, agricultural exports will increase by more than $700 million, according to a Farm Bureau economic analysis.
In recent years, the U.S. has been the residual supplier of corn, generally making sales when Argentina is out of the market. In market year 2003-2004, the U.S. accounted for only 157,000 metric tons. Without the trade agreement with Peru, the U.S. would have been at a significant disadvantage to Argentina in the future.