Commentary: Trade agreements open opportunities for U.S. farmers

Issue Date: September 13, 2017
By Zippy Duvall
Zippy Duvall
Almonds and citrus represent the top two California agricultural exports to South Korea. American Farm Bureau Federation President Zippy Duvall says the Korea-U.S. Free Trade Agreement has boosted farm sales to Korea, and that successful trade agreements benefit all parties involved.
Photo/Christine Souza
Almonds and citrus represent the top two California agricultural exports to South Korea. American Farm Bureau Federation President Zippy Duvall says the Korea-U.S. Free Trade Agreement has boosted farm sales to Korea, and that successful trade agreements benefit all parties involved.
Photo/Paolo Vescia

International trade has given American farmers and ranchers partnerships and business relationships with people all over the world. The boost in business abroad bolsters agriculture and creates more jobs here at home. Successful trade agreements benefit all parties involved by setting the highest standard of trade rules and improving competitiveness.

When the United States and South Korea reached an agreement on preferential trade terms in 2007, neither country knew that the global economy was about to look very different from the previous few years.

The world entered a prolonged recession in 2008, putting a damper on demand for everything, even food. Despite that, the Korea-U.S. Free Trade Agreement—KORUS, for short—which took effect in 2012, benefited U.S. agricultural exports by securing a much larger share of the South Korean market for U.S. beef, pork and other products.

U.S. pork exports to South Korea have more than doubled under KORUS. U.S. beef exports to South Korea have increased 82 percent. These gains are the result of lower tariffs, growing import quotas and science-based trade rules that open the door for more U.S. farm goods.

Today, the United States has a 27 percent share of the South Korean import market, compared to just 11 percent for the No. 2 supplier, China. As a result of our preferential trade status with South Korea, as well as the recovery in the global economy, U.S. agricultural exports to South Korea could set a new record, topping $7 billion this year. With U.S. agricultural imports from South Korea projected to be about

$500 million, we are looking at an agricultural trade surplus of 93 percent.

South Korea is heavily dependent on agricultural imports. If the United States were to withdraw from KORUS, South Korea still would need to import the same amount of food. It would just get that food from our competitors instead of U.S. farmers and ranchers. In fact, some of our competitors, such as Australia, Canada and the European Union, have signed their own trade agreements with South Korea. They say imitation is the highest form of flattery. It certainly provides evidence that the U.S. was wise to secure the largest share of the South Korean market.

Agricultural trade under KORUS is a success story. It allows the U.S. to play to our strength—our highly productive farms and ranches. We cannot afford to walk away from that.

At the same time, agriculture will be front and center in the recently launched North American Free Trade Agreement negotiations.

NAFTA has broken down trade barriers and reduced tariffs that keep American farmers and ranchers from reaching new customers. Annual agricultural exports to Canada and Mexico soared from $8.9 billion in 1993 to $38.1 billion in 2016. But that doesn't mean there isn't room for improvement.

Renegotiation is an opportunity to make this trade deal even better. The American Farm Bureau Federation is working closely with Congress, the White House and government agencies so they know what our priorities for NAFTA are, and what we need to make them happen. We are confident U.S. trade negotiators will represent the needs of America's farmers and ranchers. In fact, President Trump has committed to farmers and ranchers that a renegotiated NAFTA will make U.S. agricultural trade even better than it has been these last 24 years.

We are glad to see that continued market access remains the top objective for agriculture in the administration's NAFTA strategy.

Even though NAFTA has been positive for agriculture as a whole, there are individual commodities or agricultural sectors facing trade challenges with our neighboring countries. A truly modernized NAFTA will use science-based rules that prevent and resolve unfair trade barriers allegedly erected in the name of protecting animal, plant or human health.

We want to see the U.S. and our trade partners become global leaders in setting market-driven and science-based terms for trade. To that end, AFBF has the distinct honor of hosting the 38th biennial North American and European Union Agricultural Conference this fall. Hosting such a prestigious global event in Washington, D.C., gives us an opportunity to build lasting relationships and friendships to help further opportunities for U.S. agriculture in the global market.

Free trade, while positive, also can be disruptive. It rejiggers markets once thought to be predictable. It might even lead us to change what we grow. But one thing it almost always does is give America's highly productive and efficient farmers and ranchers an edge in the global economy.

Free trade reflects one of the most positive aspects of farmers the world over: our ability to come together and find strength in our differences. It drives growth in our industry and expands access to safe and sustainable products at home and abroad.

(Vincent "Zippy" Duvall, a poultry, cattle and hay producer from Georgia, is president of the American Farm Bureau Federation.)

Permission for use is granted, however, credit must be made to the California Farm Bureau Federation when reprinting this item.