TRADE UPDATE

Food & Agriculture
March 26, 2024

By Kristy Goodfellow, Vice President of Trade and Industry Affairs, and Natalie Diez, Trade and Economic Policy Intern

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HIGHLIGHTS

  • U.S.-China: On Mar. 20, the U.S. House Agriculture Committee hosted a hearing on the dangers China poses to American agriculture. Panelists addressed and responded to questions about agricultural technology theft; land ownership; input sourcing; and USDA representation on the Committee of Foreign Investment in the United States (CFIUS), among other topics.
  • U.S.-Paraguay: The U.S. Senate passed a bipartisan Congressional Review Act (CRA) resolution initiated by Senators Jon Tester (D-Mont.) and Mike Rounds (R-S.D.) that would overturn USDA’s decision to permit beef imports from Paraguay.
  • U.S.-Colombia: Several news sources have reported that the Government of Colombia is considering a countervailing duty (CVD) investigation of U.S. corn imports.
  • Americas Partnership for Economic Prosperity (APEP): On Mar. 19, during the first APEP meeting of trade ministers, the trade ministers emphasized the importance of implementing the Leader’s priorities, including work on trade facilitation and digitalization of customs procedures; promoting greater access to the benefits of trade for small and medium-sized enterprises and underserved communities; among others.
  • U.S.-Colombia: On Mar. 21, USTR announced that as of Feb. 26, Colombia reopened its market for U.S. poultry and egg products, which closed in August 2023 due to concerns over Highly Pathogenic Avian Influenza (HPAI).
  • Trade Remedies: On Mar. 19, the United States accepted the adoption of the WTO compliance report in a dispute with the EU over ripe olives from Spain. The EU can now request authorization to suspend U.S. concessions if the United States does not fulfill the compliance panel recommendations.
  • U.S.-India: On Mar. 15, India and the United States submitted a mutually agreed solution in WTO dispute DS 430. The United States originally initiated this dispute with India in 2012 over India’s import prohibitions related to HPAI. This announcement of an agreed solution was initially made by USTR in September 2023, following the U.S.-India meeting at the G20 Leaders’ Summit.
  • Food and Agriculture Organization (FAO) of the United Nations: After a four-day FAO Ministerial Conference for Latin America and the Caribbean, Leaders made a “renewed commitment to the FAO’s Strategic Framework 2022-31 and four regional priorities that will guide the work of the Organization for the next biennium.”

“The fact China imports almost as much food as the U.S. exports to the whole world makes this conversation more difficult. In recent years, the U.S. has seen record export values to China for soybeans, corn, beef, chicken meat, tree nuts, and sorghum, all of which are major contributors to our domestic farm economy, underscoring the importance of expanded market access and market diversity elsewhere. So, how do we strike the balance of protecting our producers and consumers, and every piece of the agricultural value chain, while keeping pace with China’s needs?”

—Representative GT Thompson in his opening remarks during the House Committee on Agriculture hearing on China

U.S.-China

U.S. House of Representatives Agriculture Committee China Hearing

  • On Mar. 20, the U.S. House Agriculture Committee hosted a hearing on the dangers China poses to American agriculture.
  • Panelists addressed and responded to questions about agricultural technology theft; land ownership, including around military sites; sourcing of critical agricultural inputs; and USDA representation on the Committee of Foreign Investment in the United States (CFIUS), among other topics.
  • Panelists include South Dakota Governor Kristi Noem; Rep. Mike Gallagher; Rep. Raja Krishnamoorthi; American Soybean Association (ASA) President Josh Gackle; and Former U.S. Ambassador to the United Nations, Kip Tom.
  • During his testimony, ASA President Josh Gackle provides three policy recommendations—to avoid revoking Permanent Normal Trae Relations (PNTR) status; pass a new farm bill, including increased funding for trade promotion programs; and reengage in bilateral and multi-lateral trade agreements.
  • Former U.S. Ambassador to the United Nations, Kip Tom emphasized relationship between national security and food security.
  • In Chairman GT Thompson’s opening remarks, he states: “The fact China imports almost as much food as the U.S. exports to the whole world makes this conversation more difficult. In recent years, the U.S. has seen record export values to China for soybeans, corn, beef, chicken meat, tree nuts, and sorghum, all of which are major contributors to our domestic farm economy, underscoring the importance of expanded market access and market diversity elsewhere. So, how do we strike the balance of protecting our producers and consumers, and every piece of the agricultural value chain, while keeping pace with China’s needs?”

U.S.-Paraguay

U.S. Senate Takes Steps to Restrict Paraguay Beef Imports

  • The U.S. Senate passed a bipartisan Congressional Review Act (CRA) resolution initiated by Senators Jon Tester (D-Mont.) and Mike Rounds (R-S.D.) that would overturn USDA’s decision to lift a ban on beef imports from Paraguay.
  • The resolution passed with a 70-25 bipartisan majority vote (which Jon Tester describes as “veto-proof”) and will now move to the House of Representatives.
  • The National Cattlemen’s Beef Association (NCBA) expressed gratitude to the U.S. Senate for passing a resolution aimed to block Paraguayan beef imports.
  • U.S. industry and opponents in Congress have raised concerns about Paraguay’s history of foot-and-mouth disease vis-à-vis USDA’s decision to allow beef imports.
  • The Biden administration opposes S.J. Res. 62, challenging USDA’s decision to allow Paraguayan beef imports, arguing it would undermine the science-based decision-making process, harm national security interests, and would “setback” bilateral relations.

U.S.-Colombia

Potential for Colombian Countervailing Duty Investigation of U.S. Corn

  • Several news sources have reported that the Government of Colombia is considering a countervailing duty (CVD) investigation of U.S. corn imports.
  • According to Trade Data Monitor, Colombia imported 3.8 million metric tons of U.S. corn (HS100590) in 2023, valuing $1.0 billion.
  • USDA Foreign Agricultural Service reported in a Mar. 20 GAIN report that U.S. market share is shrinking in Colombia, despite preferential access through the U.S.-Colombia Trade Promotion Agreement, through which an unlimited amount of U.S. corn can now entry duty free.
  • Colombia currently administers a $0.066/kg ($.20/gallon) CVD on U.S. ethanol. A review of the duties was conducted in 2022. In April 2023, it was determined that Colombia would continue to administer CVDs at the same rate.
Source: FAS GAIN Report

Americas Partnership for Economic Prosperity (APEP)

First Meeting of the Trade Ministers

  • On Mar. 19, during USTR Katherine Tai’s opening remarks at the first APEP meeting of trade ministers, Tai stressed the importance of the Americas Partnership “Trade Track” to building a “durable and inclusive regional economy, including by bolstering supply chain resilience, empowering workers, and tackling the climate crisis.” 
  • In a joint statement, the trade ministers emphasized the importance of implementation of the Leader’s priorities, including:
    • Working on trade facilitation and digitalization of customs procedures;
    • Conducting a cap analysis of value and supply chains in the critical sectors of clean energy, semiconductors, and medical supplies; and
    • Developing activities to promote greater access to the benefits of trade for small and medium-sized enterprises and underserved communities.
  • APEP was announced under U.S. leadership in 2022 and includes Barbados, Canada, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, Mexico, Panama, Peru, and Uruguay.
  • During the first meeting of APEP Leaders in November 2023, the joint statement (“East Room Declaration”) calls on Trade Ministers as part of the “Trade Track” to “develop inclusive and sustainable approaches to trade and investment that will support regional sustainable development and resilient supply chains for goods and services, enhance a predictable and transparent regulatory environment that can boost trade flows, and remove barriers to greater economic integration among our countries.”
  • In February 2024, Dominican Republic hosted the first APEP Trade meeting for senior officials, during which three subcommittees were formed: (1) Trade Rules and Transparency; (2) Trade and Sustainable Value and Supply Chains, and (3) Inclusive Trade and SMEs. 

U.S.-Colombia

Poultry Market Reopens

  • On Mar. 21, USTR announced that as of Feb. 26, the Colombian market for the U.S. poultry and egg products reopened.
  • According to a similar USDA press release, the market closed in August 2023 due to concerns over Highly Pathogenic Avian Influenza (HPAI) in the region. 
  • Additionally, according to the USDA press release, Colombia was the 10th largest market for U.S. poultry, with exports reaching $105 million in 2022.
  • USTR Chief Agricultural Negotiator Doug McKalip highlighted the Biden-Harris administration’s commitment to ensuring fair competition for American agricultural producers globally.

Trade Remedies

United States Anti-Dumping and Countervailing Duties on Ripe Olives from Spain

  • On Mar. 19, the United States accepted the adoption of the WTO compliance report in a dispute with the EU over ripe olives from Spain.
  • The EU can now request authorization to suspend U.S. concessions if the United States does not fulfill the compliance panel recommendations.
  • In a Feb. 20 report, WTO compliance panel found that the EU demonstrated that the United States failed to bring certain anti-dumping (AD) and countervailing duties (CVD) measures for ripe olives from Spain into conformity.
  • In the compliance review, the European Union argued that the United States did not comply with the DSB’s recommendations concerning Section 771B of the US Tariff Act of 1930.
  • Section 771B of the U.S. Tariff Act of 1930, is the provision of U.S. law used to determine the existence and extent of indirect subsidization (i.e. “pass-through” of benefit) in CVD investigations, involving an agricultural product process from a raw agricultural product.

U.S.-India

India and United States Resolve WTO Dispute Over Avian Influenza

  • On Mar. 15, India and the United States submitted a mutually agreed solution in WTO dispute DS 430. The United States originally initiated this dispute with India in 2012 over India’s import prohibitions on certain agricultural products due to concerns related to HPAI.
  • This announcement of an agreed solution was initially made by USTR in September 2023 following the U.S.-India meeting at the G20 Leaders’ Summit.
  • According to the USTR press release, “as part of the agreement, India also agreed to reduce tariffs on certain U.S. products, including frozen turkey, frozen duck, fresh blueberries and cranberries, frozen blueberries and cranberries, dried blueberries and cranberries, and processed blue berries and cranberries.” Details are available in a Sept. 8, 2023 exchange of letters.
  • This success was featured prominently in USTR’s 2024 Trade Policy Agenda and 2023 Annual Report.

Food and Agriculture Organization (FAO) of the United Nations

Ministerial Conference for Latin America and the Caribbean

  • On Mar. 21, a four-day FAO Ministerial Conference for Latin America and the Caribbean closed.
  • According to the FAO press release, Leaders made a “renewed commitment to the FAO’s Strategic Framework 2022-31 and four regional priorities that will guide the work of the Organization for the next biennium.”
  • The 2022-31 Strategic Framework emphasizes the “four betters”— better production, better nutrition, better environment, and better life.
  • In a closing statement, FAO Director-General QU Dongyu stated, “Latin America and the Caribbean is one of the few regions that have demonstrated progress in the fight against hunger, reducing the figures of undernourishment.”
  • Over the four days, Leaders discussed challenges, opportunities, and pathways to achieving food security and sustainable development in Latin America and the Caribbean.