TRADE UPDATE

Food & Agriculture
Dec. 17, 2024

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

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HIGHLIGHTS

  • Transportation: President-elect Donald Trump met with representatives from the International Longshoremen’s Association (ILA) on Dec. 12 and issued a statement largely sympathizing with their concerns around automation — one of the issues remaining in a labor dispute that could shut down ports on Jan. 15.
  • Trade: USDA adjusted its forecast for U.S. agricultural trade in Fiscal Year 2025, and now projects a FY2025 trade deficit of $45.5 billion.
  • Trade Preference Programs: Rep. John James (R-MI) introduced the African Growth and Opportunities Act (AGOA) Extension and Enhancement Act of 2024.
  • WTO:
    • The WTO Director-General’s annual overview of global trade developments demonstrates a rise in the coverage of trade-restrictive measures by WTO members between October 2023 and October 2024.
    • WTO Deputy Director-General Jean-Marie Paugam underscored the critical role of open trade in achieving food and nutrition security.

“It is critical that our ports and terminals have the ability to modernize their systems and processes in order to remain globally competitive and be able to handle the continuing rise of trade volumes, both imports and exports, through our ports.”

————U.S. industry coalition letter on resumption of port labor negotiations

Transportation

PORT LABOR NEGOTIATIONS

  • President-elect Donald Trump met with representatives from the International Longshoremen’s Association (ILA) on Dec. 12 and issued a statement largely sympathizing with their concerns around automation — one of the issues remaining in a labor dispute between the ILA and the U.S. Maritime Alliance.
  • A labor contract between the ILA and the U.S. Maritime Alliance, Ltd. is set to expire on Jan. 15. After a tentative agreement was reached following a three-day strike in October, parties have sparred over automation.
  • Trump’s stated: “There has been a lot of discussion having to do with ‘automation’ on United States docks. I’ve studied automation, and know just about everything there is to know about it. The amount of money saved is nowhere near the distress, hurt, and harm it causes for American Workers, in this case, our Longshoremen. Foreign companies have made a fortune in the U.S. by giving them access to our markets. They shouldn’t be looking for every last penny knowing how many families are hurt. They’ve got record profits, and I’d rather these foreign companies spend it on the great men and women on our docks, than machinery, which is expensive, and which will constantly have to be replaced. In the end, there’s no gain for them, and I hope that they will understand how important an issue this is for me.”
  • On Dec. 6, 2024, a large coalition of American manufacturers, farmers and agribusinesses, and others, signed a letter to the ILA and U.S. Maritime Alliance urging parties to resume negotiations. Regarding automation, the letter states, “It is critical that our ports and terminals have the ability to modernize their systems and processes in order to remain globally competitive and be able to handle the continuing rise of trade volumes, both imports and exports, through our ports.”

Trade

USDA OUTLOOK FOR U.S. AGRICULTURAL TRADE

  • USDA adjusted its forecast for U.S. agricultural trade in Fiscal Year 2025, and now projects a FY2025 trade deficit of $45.5 billion.
  • New estimates project exports of $170.0 billion and imports of $215.5 billion.
SOURCE: USDA

Trade Preference

AFRICAN GROWTH AND OPPORTUNITY ACT REAUTHORIZATION BILL

  • Rep. John James, the Michigan Republican who chairs the House Foreign Affairs Committee’s Subcommittee on Africa, introduced the AGOA Extension and Enhancement Act of 2024.
  • The current authorization is scheduled to expire in September 2025. The bill proposes extending AGOA by 12 years.
  • AGOA provides eligible sub-Saharan African countries with duty-free access to the U.S. market for more than 1,800 products, in addition to 5,000 products that are eligible for duty-free access under the Generalized System of Preference program.
  • Petroleum products make up the largest share of overall AGOA imports but also include some agricultural products such as macadamia nuts and fresh oranges.

WTO

GLOBAL TRADE DEVELOPMENTS

  • The WTO Director-General’s annual overview of global trade developments demonstrates a rise in the coverage of trade-restrictive measures by WTO members between October 2023 and October 2024.
  • The report also highlights members’ introduction of a substantial number of trade-facilitating measures.
  • The WTO argues there is increasing evidence of inward-looking trade policies which could generate further uncertainty for the global economy.
  • DG Ngozi Okonjo-Iweala cautioned that “export restrictions are also gaining momentum.” According to the report, the accumulated stockpile of export restrictions since 2009 is estimated to affect 3.2% of world exports.
  • Okonjo-Iweala further warned that “the global trading environment appears increasingly fragile, uncertain, and precarious.”
  • The report also indicated that several economies implemented trade and trade-related measures citing national security considerations. Meanwhile this week, the United States argued in a WTO paper that litigating matters of essential security at the WTO undermines the foundation of the WTO.
  • WTO monitoring points to the increasing evidence of trade fragmentation linked to geopolitical concerns.
Source: WTO

TRADE AND FOOD SECURITY

  • WTO Deputy Director-General Jean-Marie Paugam underscored the critical role of open trade in achieving food and nutrition security.
  • He emphasized the importance of updating the WTO rulebook.
  • In 2010, the diversity of products available for consumption globally was almost 60% higher than that produced domestically; that figure rose to 90% higher in 2020.
  • DDG Paugram indicated trade policy can expand nutritional choices for consumers, such as lowered tariffs on nutritious foods, health warnings, and nutrition labeling.