Farm leaders seek to widen NAFTA gains


Issue Date: August 23, 2017
By Ching Lee
Canada is the No. 2 market for California agricultural exports and Mexico No. 5, according to the state Department of Food and Agriculture. Agricultural leaders from the U.S., Canada and Mexico say the North American Free Trade Agreement has, on balance, been positive for farmers and ranchers in the three countries.
Graphic/Joanna Smith
American Farm Bureau Federation President Zippy Duvall, right, discusses NAFTA during a Washington, D.C., news conference. Listening, from left, are Bosco de la Vega of Mexico’s National Agricultural Council and Ron Bonnett of the Canadian Federation of Agriculture.
Photo/Philip Gerlach

Saying that agriculture represents one of the biggest success stories of the North American Free Trade Agreement, leaders of the largest farm organizations in the U.S., Canada and Mexico have asked trade negotiators for all three countries to "do no harm" to agricultural trade as they renegotiate the 23-year-old treaty.

Presidents Zippy Duvall of the American Farm Bureau Federation, Ron Bonnett of the Canadian Federation of Agriculture and Bosco de la Vega of the National Agricultural Council in Mexico made their point during a news conference in Washington, D.C., last week in support of NAFTA.

Their statements came as negotiators from the three member countries began the first round of talks on revamping the trade deal. The agricultural leaders also sent a joint letter to their respective countries, reiterating calls that NAFTA renegotiations should aim to modernize the agreement rather than to dismantle it.

"We come today to show our unity," Duvall said. "We are committed to preserving and expanding upon the gains that agriculture has achieved and ensuring a modernized NAFTA continues to be a success story for North America farmers and ranchers."

Canada is the No. 2 destination for California agricultural exports and the top customer for U.S. farm exports; Mexico ranks fifth for the state and third for the nation.

The farm leaders agreed that even though NAFTA has been largely positive for North American agriculture as a whole, there remains room for improvement. They said they would like to build on the original agreement's success by looking for ways to increase trade volumes.

They outlined five priorities in their letter that they say could help improve agricultural trade among the three countries: increase and improve regulatory alignment; improve the flow of goods at border crossings; further align sanitary and phytosanitary measures using a science-based approach; eliminate nonscience-based technical barriers to trade; and revise trading rules so that they reflect technological advances since NAFTA implementation, such as digital trade.

California Farm Bureau Federation President Paul Wenger said those priorities are in line with what farmers in the Golden State would like to see. Reducing technical trade barriers and the improving logistical movement of products, he said, would benefit all three countries.

With so many pressing issues keeping the Trump administration busy, Wenger said he doesn't think trade negotiators will try for "anything earthshaking," such as changes to how individual commodities would be handled. Instead, they'll likely aim for areas where the three countries share common ground, he added.

"They're going to look for some things they could say, 'We improved it, we did better' and move on," he said. "They need to show a victory."

The improvements agricultural leaders seek were largely being addressed through the Trans-Pacific Partnership, a 12-nation trade agreement that included the U.S., Canada and Mexico, Wenger noted. President Trump withdrew from that deal earlier this year, though the other 11 nations have agreed to revive TPP without U.S. participation. With TPP off the table, Wenger said, the NAFTA renegotiation may be the best vehicle to "fix some of the things that were going to be in TPP."

"I think the best thing we can do for a lot of our specialty crops, which Mexicans and Canadians want very much, is to be able to move them across the border in as effortless a way as we can and to get the transactions working smoothly," Wenger said.

But conflicting views among the three North American trading partners could make NAFTA discussions difficult and potentially drawn out.

During opening remarks at the start of the renegotiation talks, U.S. Trade Representative Robert Lighthizer said NAFTA "has fundamentally failed many Americans and needs major improvements," adding that Trump isn't interested in "a mere tweaking" of a few provisions and chapters. The administration has vowed to make reducing the U.S. trade deficit with Canada and Mexico a priority in the renegotiations.

The farm leaders noted that Lighthizer singled out agriculture as a shining example of where NAFTA has succeeded: by increasing trade among the three nations. For the U.S., farm exports to Canada and Mexico soared from $8.9 billion in 1993, before NAFTA implementation, to $38.1 billion in 2016, according to AFBF.

"With our leadership in all three countries recognizing that agriculture is important, we the farm leaders of all three countries must insist that the voices of farmers and ranchers must be heard as these renegotiations proceed," Bonnett said.

Duvall pointed out that total U.S. agricultural exports are projected to reach $137 billion this year, while agricultural imports are forecast at $114.5 billion, giving the U.S. a $22.5 billion trade surplus in agricultural products.

"So for all the criticisms of our trade deals, we in agriculture want our negotiators to know that trade deals and open markets are largely beneficial to American farmers and ranchers, and to the communities that we live in and do our business in and raise our families," he said.

Not all sectors of agriculture have benefited from NAFTA, though. Wenger noted that imports of Mexican asparagus, avocados, tomatoes and cut flowers have hurt California growers, whose production and labor costs are much higher than their Mexican counterparts'. Even so, Wenger said he thinks the agreement has on balance been positive for California agriculture.

(Ching Lee is an assistant editor of Ag Alert. She may be contacted at clee@cfbf.com.)

Permission for use is granted, however, credit must be made to the California Farm Bureau Federation when reprinting this item.