Much of the agricultural sector praised the passage of the free trade agreements in the House and Senate. The White House transmitted the FTAs with Korea, Colombia and Panama to Congress last week.
Ohio Sen. Rob Portman, as well as Ohio House Reps. Austria, Chabot, Gibbs, Johnson, Jordan, Latta, Renacci, Schmidt, Stivers, Tiberi and Turner voted in favor of the trade agreements.
“This legislation provides Ohio grain, in turn, Ohio farmers, with significant market export opportunities,” said Tadd Nicholson, Ohio Corn and Wheat Growers Association interim CEO and director of government and industry affairs. “Our corn and wheat growers can more effectively compete on the international trade market.”
The fiscal returns from the successful passage of the FTAs will also help offset the federal deficit to propel the nation for economic growth. Statistics show that the FTAs have the potential to create 250,000 American jobs and to add an additional $13 billion annually in exports.
The United States is the largest corn producer and exporter in the world. During the 2009-2010 marketing year, the U.S. exported 50.4 million metric tons of corn worldwide. The U.S. is also the world’s largest wheat exporter, with half of its production moving to export markets. In the 2010-2011 marketing year, the U.S. exported nearly 1.3 billion bushels of wheat valued at $10.3 billion.
“These agreements will not just benefit Ohio farmers. It will benefit the overall state economy and provide job-growth opportunities,” said Bret Davis, Ohio Soybean Association president and Delaware County soybean farmer. “These agreements do not just benefit soybeans, but all grain, oilseed, fiber, fruit, vegetable and livestock products. We look forward to working to gain market share and to bringing new economic and job-growth opportunities back to the U.S. and Ohio.”
Ohio soybean farmers benefit greatly from international markets and thousands of Ohio jobs depend on soybean exports. The trade agreements with Colombia, Panama and South Korea will result in increased exports of Ohio soy and soy-fed meat and poultry and will benefit soybean farmers and rural economies. According to the American Farm Bureau Federation, the agreement with South Korea alone represents an additional $1.8 billion annually. Ohio soybeans will benefit because:
- Soybeans imported to South Korea for use in cooking oil and livestock feed will enter duty-free.
- South Korea will eliminate the current tariff on soybeans imported for food uses such as for tofu and soymilk.
- Colombia will immediately eliminate a system of variable tariffs on soybean imports, which has imposed tariffs as much as 150%.
- Colombia will phase out its 24% tariff for refined soybean oil throughout the next five years.
- Panama’s current 0% tariff treatment for soybeans and soybean meal will be locked immediately upon implementation of this agreement.
- Panama’s current 0% tariff treatment for crude soybean oil will also be locked immediately, with the 20% tariff on refined soybean oil being phased out in 15 years.
The major livestock sectors of Ohio also stand to benefit significantly from the trade agreements.