The U.S. and Australia finalized negotiations on a free trade agreement (FTA) designed to eliminate and reduce tariffs and other trade barriers. According to the Office of the U.S. Trade Representative (USTR), more than 99% of U.S. manufactured goods exported to Australia will become duty-free immediately upon implementation of the agreement. Manufactured goods account for 93% of U.S. exports to Australia. Agriculture was one of the most continuous items in the negotiations, especially beef, sugar and dairy. Key agriculture items include:
Pork – U.S. and Australia are to resolve sanitary and phytosanitary barriers. This should be completed this spring.
Beef – duties will be phased out over an 18-year period. The quota for Australian beef will increase by 18.5% over 18 years, followed by free trade.
Dairy – imports from Australia under the tariff rate quota will increase about 2% of current value of total U.S. dairy imports. The additional imports are not expected to affect the dairy price support program.
Sugar – exempted from the agreement.
Items that immediately receive tariff elimination include processed foods, soups, bakery products, fruits and vegetables, dried onion, fruit and vegetable juices, dried plums, potatoes, almonds, tomatoes, cherries, raisins, olives, fresh grapes, sweet corn, frozen strawberries, and walnuts.
Congress is expected to consider the Australian FTA this year.
