TRADE UPDATE

Food & Agriculture
Oct. 29, 2024

By Kristy Goodfellow, Vice President of Trade and Industry Affairs and Ameya Khanapurkar, Trade Intern

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HIGHLIGHTS

  • Brazil Ethanol Tariffs: Brazil’s Foreign Trade Chamber rejected a proposal by the Brazilian Association of Fuel Importers (ABICOM) to remove an ethanol import tariff.
  • G20 Trade and Investment Ministers: U.S. Trade Representative Katherine Tai and Chief Agricultural Negotiator Doug McKalip attended the G20 Trade and Investment Ministers’ conference.
  • USTR: Tai met with Caribbean leaders to discuss inclusive trade and investment policies.
  • Yellen Remarks on Economic Leadership: Treasury Secretary Janet Yellen outlined the importance of maintaining U.S. global economic leadership and engagement.
  • Global Trade Outlook: The World Trade Organization released its October 2024 Global Trade Outlook, which outlined trends in the international trade of merchandise and services and highlighted increasing fragmentation in the U.S.–China trade relationship.
  • Mexico’s Food Sovereignty Program: Mexican President Claudia Sheinbaum presented the priorities of the country’s National Program of Food Sovereignty.

“The WTO has observed increasing signs of fragmentation in trade flows since the onset of the war in Ukraine, with exports and imports reorienting along geopolitical lines.”

———-World Trade Organization, October 2024 Global Trade Outlook

US-BRAZIL

BRAZIL REJECTS PETITION TO LIFT TARIFF ON ETHANOL IMPORTS

  • Brazil’s Foreign Trade Chamber rejected a proposal by the Brazilian Association of Fuel Importers (ABICOM) to remove an ethanol import tariff.
  • In October 2023, ABICOM requested to drop the ethanol duties due to the increased fuel costs for customers.
  • U.S. Trade Representative Katherine Tai engaged with Geraldo Alckmin, Brazil’s Vice President and Minister of Development, Industry, Foreign Trade and Services, urging efforts to address the market access barrier for U.S. ethanol.
    • This conversation happened in addition to a discussion about opportunities to collaborate on supply chain resiliency, diversification efforts, and ways to strengthen bilateral trade and economic partnership.

G20

G20 MINISTER’S MEETING

  • Tai and USTR Chief Ag Negotiator Doug McKalip recently participated in the G20 Trade and Investment Ministers’ meeting in Brasilia, Brazil.
  • Ambassador Tai engaged in bilateral matters with Geraldo Alckmin, Brazil’s Vice President and Minister of Development, urging efforts to address market access barriers to U.S ethanol and discussing opportunities to collaborate on supply chain resiliency.
  • Ambassador Tai met with Geneva-based International Trade Center Executive Director Pamela Coke-Hamilton, discussing opportunities to engage with Africa and the Caribbean, supply chain resiliency, and the importance of inclusive growth and institutions.
  • In her meeting with World Trade Organization Director General Ngozi Okonjo-Iweala, Tai discussed WTO member participation amidst new visions of globalization.
Source: X.com

USTR

TAI MEETS WITH CARICOM MEMBER STATES

  • Tai and Paula Gopee-Scoon, Trinidad and Tobago’s minister of Trade and Industry and the Chair of the Council for Trade and Economic Development of the Caribbean Community (CARICOM), co-chaired a meeting with representatives from 10 other CARICOM members.
  • The ministers discussed how the United States and CARICOM can collaborate to advance inclusive trade and investment policies.
  • The United States exported $2,651,463,610 in agricultural and related products to CARICOM members in 2023.

Treasury

SECRETARY YELLEN COMMENTS ON TRADE AND THE ECONOMY

  • Treasury Secretary Janet Yellen gave remarks at the Council on Foreign Relations emphasizing the gains from American global economic leadership.
  • Yellen emphasized the crucial nature of avoiding economic instability and protecting global economic growth for U.S. economic well-being.
  • Yellen argued “walling America off with high tariffs” is “deeply misguided.”
  • Yellen outlined the role of trade in expanding markets for U.S. exports, helping producers access key inputs, and allowing greater access to goods for consumers.
  • Yellen described Chinese threats on U.S. industry as barriers to market access, unfair trade practices, and industrial overcapacity.

WTO

GLOBAL TRADE OUTLOOK

  • The World Trade Organization released the October 2024 Global Trade Outlook, which outlines global growth trends in merchandise and services trade, global macroeconomic conditions, and regional trade trends.
    • From 2019-2023, the report observed a 33% growth in the trade of agricultural products.
    • But in 2023-24, the report noted a 1% decline in trade growth of agriculture products.
  • While the report typically focuses primarily on economic analysis, this edition focused on a new trend of decoupling and fragmentation, especially between the United States and China. 
    • The report states, “The WTO has observed increasing signs of fragmentation in trade flows since the onset of the war in Ukraine, with exports and imports reorienting along geopolitical lines.”
    • This trend is observed across the entire spectrum of goods.
    • The two clear periods of decoupling occurred in the trade tensions beginning in July 2018 and immediately following the invasion of Ukraine in February 2022.
    • There was a period of recovery in February 2020, which the report attributes to the role of China in global supply chains during the COVID-19 pandemic.
Source: Global Trade Outlook

Mexico

SHEINBAUM PRESENTS FOOD SOVEREIGNTY PROGRAM

  • Mexico’s new president, Claudia Sheinbaum, presented certain priorities and programs under what the administration is calling the “National Program of Food Sovereignty.”
  • The new support programs are intended to support a range of priorities, including modernizing irrigation, guaranteeing the price of corn and tortillas, guaranteeing the self-sufficiency of seeds, and propelling sustainable ranching, rice, and milk production.
  • Secretary of Agriculture and Rural Development Julio Berdegué Sacristán outlined the fundamental axes of food sovereignty, which he describes as:
    • Eradicating poverty,
    • Increasing national production of food,
    • Efficiently using water in irrigation and sustainability to accelerate the ecological transition of the agriculture system,
    • Reducing deforestation, pesticide use, and propelling sustainable fishing.
  • The Undersecretary of Agriculture and Rural Development announced the plan to control milk prices by constructing a pasteurization plant, a dried milk plant, and collecting centers across various states.