Pacific trade deal finalized after last-minute dairy talks

By Philip Brasher

© Copyright Agri-Pulse Communications, Inc.



WASHINGTON, Oct. 5, 2015 - The United States and 11 other Pacific rim nations announced a landmark agreement to liberalize trade across 40 percent of the global economy after a last-minute push by New Zealand to lower U.S. barriers to dairy imports. 

The deal on the Trans-Pacific Partnership, reached in a final round of negotiations in Atlanta that stretched into the early morning Monday, will allow the agreement to  be submitted to Congress for approval early next year. 

Details of the agreement on issues such as agriculture were not made available immediately, but it was clear that Canada successfully protected its supply management system for dairy and poultry products.

Discussions on New Zealand's demands for increased access to the U.S. dairy market weren't wrapped up until 5 a.m., said New Zealand's trade minister, Tim Groser. According to U.S. dairy industry source, New Zealand raised the demand Sunday to offset the lack of access it was getting under the deal with Mexico and Canada. 

U.S. Trade Representative Michael Forman said tariffs on meat and poultry "would be eliminated, greatly reduced, or quotas will be significantly increased.” He said the deal also would open up "additional opportunities” U.S. dairy products.

Together we can feed the Bees"

President Obama will go to the Agriculture Department on Tuesday to launch his campaign to get the agreement approved. Obama is scheduled to appear with business leaders and Agriculture Secretary Tom Vilsack. 

“It's no coincidence the president is traveling to that department because the agriculture economy benefits significantly from the terms of this agreement,” said White House press secretary Josh Earnest. 

Summaries released by the White House and Froman's office said the agreement would provide “increased transparency and cooperation” on agricultural biotechnology and would cut tariffs that are as high as 40 percent on U.S. poultry products, 35 percent on soybeans, and 40 percent on fruit exports. 

The agreement also would ensure that “foreign regulations and agricultural inspections are based on science, eliminating agricultural export subsidies, and minimizing unpredictable export bans.”

In a joint statement, the trade ministers of the 12 nations said the deal would “support jobs, drive sustainable growth, foster inclusive development, and promote innovation across the Asia-Pacific region. 

“Most importantly, the agreement achieves the goal we set forth of an ambitious, comprehensive, high standard and balanced agreement that will benefit our nations' citizens.”

Under terms of the Trade Promotion Authority bill Congress passed this summer, the agreement must be made public for at least 90 days before it can be signed. Froman said his staff would be briefing lawmakers on the details in coming days and talking to congressional leaders “to determine what is the best pathway” for consideration of the agreement. TPA also allows Congress only an up or down vote on the agreement, with no amendments.

Vilsack said the agreement would "eliminate or significantly reduce tariffs on our products and deter non-science based sanitary and phytosanitary barriers that have put American agriculture at a disadvantage in TPP countries in the past.

"Failing to grasp this opportunity would be a mistake," Vilsack said. "Worse than just losing out on potential gains, our producers would fall behind other countries that are negotiating their own preferential arrangements in TPP countries." 

One ally the administration needs in Congress, House Agriculture Chairman Mike Conaway, R-Texas, signaled some concerns about the deal, including on language on how tobacco could be regulated. The agreement would allow countries to implement controls on tobacco products. 

"While I am encouraged to hear that U.S. livestock products such as beef and pork will see significant gains in market access, it will take a coalition of many to move TPP over the coming months. At this time, I am skeptical that these concerns were sufficiently addressed but will remain open-minded, and I look forward to studying the agreement,” said Conaway.

U.S. farm groups released statements that mostly said they were awaiting the details of the agreement. 

The Sweetener Users Association, which has been pushing to increase sugar imports, said the deal would allow Australia to ship an additional 65,000 tons of sugar into the United States. But Sen. Heidi Heitkamp, D-N.D., indicated that any increased sugar imports under TPP would be modest enough to ensure that the price-support program could continue to operate without subsidies. 

The American Sugar Alliance, which represents sugar producers, said it was “cautiously optimistic” about the agreement.

In a joint statement, the National Milk Producers Federation and U.S. Dairy Export Council thanked lawmakers for a flurry of letters they sent to Froman last week supporting the industry's position. The groups said they would “carefully review the agreement's dairy provisions in the coming days.”

The Biotechnology Industry Organization said it had to review the language before commenting on the agricultural biotech provisions. 

New Zealand's Groser didn't provide any details on what concessions his country had won in the late-night negotiations, but he said the agreement would “create opportunities” for dairy farmers in New Zealand and Australia and help address global market volatility. 

A summary released by the government of New Zealand said its dairy exporters would have preferential access to new quotas into the United States, Japan, Canada and Mexico. Some tariffs would also be eliminated.

Canada's trade minister, Ed Fast, said his country had preserved the production, price and import controls that manage dairy and poultry supplies in Canada. Farmers “can now continue to invest in their industry, grow their industry. That is an outcome we're very pleased with.”

Besides the U.S., the TPP countries are: Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

(Updated 2 p.m.) 

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