TRADE UPDATE

Food & Agriculture
August 13, 2024

By Kristy Goodfellow (Vice President of Trade and Industry Affairs), Isabella Montero (Communications Intern), Molly Shields (Government Relations Intern)

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HIGHLIGHTS

  • US-Kenya: From Aug. 5-9, the United States and Kenya held their sixth in-person negotiating round of the STIP, in Nairobi, Kenya, which included an exchange of views on previously proposed text on agriculture and several other technical areas.
  • Caribbean: USTR Katherine Tai met with ministers from CARICOM member states to discuss economic opportunities between the U.S. and Caribbean trade partners.
  • Trade Promotion: USDA announced an additional $300 million in funding for the Regional Agricultural Promotion Program (RAPP).
  • Southeast Asia: USDA’s Economic Research Service published a report on “U.S. Agricultural Exports in Southeast Asia,” which highlights many circumstances in which competitors have preferential trade agreements in place. Those pacts, the report concludes, are likely contributing to a shrinking American market share within the region.
  • India: The International Food Policy Research Institute analyzed the effects of India’s rice export restrictions a year after they were imposed, concluding that the bans continue to fuel high prices.

“Southeast Asia is a promising region, with a growing middle class and emerging economies, to which the United States can expand its agricultural exports … However, the United States is not the only potential source for Southeast Asia’s growing demand for agricultural goods — over the last 10 years, the U.S. share of Southeast Asia’s agricultural imports has remained steady, while shares for major competitors like China and Brazil have grown.”

——USDA Economic Research Service, in a report on “U.S. Agricultural Exports in Southeast Asia”

US-Kenya

Strategic Trade and Investment Partnership

  • From August 5-9, the United States and Kenya held their sixth in-person negotiating round of the Strategic Trade and Investment Partnership, in Nairobi, Kenya.
  • According to USTR, the negotiations included an exchange of views on previously proposed text on agriculture; customs, trade facilitation, and enforcement; environment; good regulatory practices; inclusivity; and workers’ rights and protection.
  • Details on the next negotiating round are forthcoming, USTR noted.
  • A joint statement from previous talks in June noted both parties intended to complete the agreement by the end of the year.
  • The STIP negotiations were launched on July 14, 2022, with the goal of creating “high standard commitments in a wide range of areas.”
  • In recent years, U.S. exports of agricultural and related products have ranged from about $30-70 million annually, largely depending on exports of vegetable oils (excluding soy) and wheat.  Meanwhile, annual American imports of agricultural and related products from Kenya range from $127-192 million over half of which is coffee.

Caribbean

Council for Trade and Economic Development of the Caribbean Community Meeting (CARICOM)

  • On August 2, USTR Katherine Tai met with ministers from CARICOM member states to discuss economic opportunities between the United States and Caribbean trade partners, including the Caribbean Basin Initiative and the U.S.-CARICOM Trade and Investment Framework Agreement (TIFA).
  • The leaders emphasized the importance of sustainable and inclusive trade and economic development, agreeing to strengthen U.S.-Caribbean trade relations.
  • On the margins of the meetings, Tai spoke with Guyana’s Minister of Foreign Affairs and International Cooperation Hugh Todd and Paula Gopee-Scoon, Trinidad and Tobago’s Minister of Trade and Industry who also serves as the Chair of CARICOM.
  • According to USDA figures, U.S. exports of agriculture and related products to the Caribbean totaled nearly $5.7 billion, including $680.2 million in poultry meats and products. In 2023, the U.S. imported $2 million in agricultural and related products from the Caribbean.

Trade Promotion

Additional RAPP Funding to Expand US Export Market

  • On Aug. 5, USDA Deputy Agriculture Secretary Xochitl Torres Small announced an additional $300 million in funding for the Regional Agricultural Promotion Program (RAPP).
  • RAPP was created in 2023 to diversify U.S. export markets beyond China, Mexico, and Canada, which currently account for almost half of all American export sales.
  • USDA allocated the first $300 million of RAPP funding in May to 66 organizations and recently published a Notice of Funding Opportunity for the additional funding. Interested organizations must apply by Oct. 4, and USDA plans to announce allocations before the end of the calendar year.
  • USDA originally allocated $25 million in RAPP funding for developing export markets in Africa and intends to do the same for the second round of RAPP funding.

Southeast Asia

USDA Reviews U.S. Agricultural Exports in Region

  • USDA’s Economic Research Service recently published a report on “U.S. Agricultural Exports in Southeast Asia,” looking at trends in U.S. exports and the international efforts of overseas competitors.
  • Specifically, the report looks at competitiveness in certain U.S. exports — soybeans, cotton, wheat, skim milk powder, dried distillers grains, food preparations, poultry, and beef.
  • The report highlights many circumstances in which competitors have preferential trade agreements in place which are likely contributing to their growing market share within the region. 
  • The report highlights the growing market opportunities in the region, but also notes the U.S. “is not the only potential source for Southeast Asia’s growing demand for agricultural goods — over the last 10 years, the U.S. share of Southeast Asia’s agricultural imports has remained steady, while shares for major competitors like China and Brazil have grown.”

India

IFPRI Reports on India’s Rice Export Bans

  • Roughly one year after India’s rice export restrictions were first imposed, the bans continue to fuel high prices, according to an analysis from the International Food Policy Research Institute.
  • The report notes that “rice price inflation puts pressure on large numbers of low-income consumers in these countries, as rice consumption makes up a significant proportion of their daily calorie intake.”
  • The United States and others have raised concerns with India’s domestic and trade policies related to rice and certain other commodities for many years, questioning consistency with WTO obligations and the impact of the protocols on global markets and food security.