A top Trump trade official says the U.S. wants to use upcoming trade talks with Canada and Mexico to tighten the eligibility of products entering the U.S.
When officials in the first Trump administration negotiated the U.S.-Mexico-Canada Agreement, they imposed stringent rules-of-origin governing which cars could qualify. At least 75% of a qualifying car’s value had to come from components from North America.
U.S. Trade Representative Jamieson Greer said at an Atlantic Council event that he wants to take a similar approach to products in other industries.
Take note: This could have implications for U.S. ag. In recent public comments on the forthcoming review, some respondents took aim at lax rules-of-origin provisions for products like soybean meal.
John Sheppard, president of Sheppard Grain Enterprises, an organic soybean processor, complained in a submission that Canada is using the USMCA to undercut U.S. meal producers.
“Canadian soybean crushers are importing soybeans, worldwide,” Sheppard wrote, then sending the resulting meal to the U.S. tariff-free. “SGE cannot compete with Canadian organic soybean meal priced $50-$80 lower per ton than the production costs of SGE meal.”
USDA approves six SNAP food restriction waivers
The Agriculture Department has approved six new state waivers to restrict the use of SNAP benefits to purchase soft drinks, candy or other sugary foods.
The newly granted waivers bring the total number of USDA-approved waivers to 18. They were submitted by Hawaii, Missouri, North Dakota, South Carolina, Virginia and Tennessee.
Take note: USDA’s press release didn’t specify which products each state banned, but Agri-Pulse was able to get some information from state-level websites and spokespeople. The new information has been added to our online SNAP food restriction tracker. The tracker will continue to be updated as more information becomes available.
Ways and Means moves bill to revive expired African trade program
The House Ways and Means Committee advanced legislation on Wednesday to reauthorize the African Growth and Opportunity Act for three years. The program, which provides tariff-free access to the U.S. market for eligible products from sub-Saharan African countries, expired earlier this year.
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The bill secured bipartisan support, but Democrats pointed out that they would have preferred reforms to the program to strengthen the environmental and labor provisions.
Republicans also voted down Democratic amendments to link the bill to an effort to revive a program to help workers and farmers facing adverse impacts from imports. Committee Chair Jason Smith, R-Mo., argued that a clean bill would give it the best chance of success.
Trade subcommittee Chair Adrian Smith, R-Neb., stressed that the program has delivered benefits for U.S. exporters as well, including in the ag sector, as incomes have grown in beneficiary countries.
“With the fastest-growing population and untapped economic potential, we must maintain reliable and proactive engagement across the continent of Africa,” Adrian Smith said.
Take note: The White House hasn’t endorse the bill. It has instead called for a one-year extension while the U.S. considers adjustments to the program.
USTR Greer told senators on Tuesday that he would be open to removing South Africa from the program over its barriers to U.S. imports. The U.S. pork industry has previously called on lawmakers to bolster AGOA’s enforcement mechanisms to address South Africa’s trade issues.
Trump fertilizer tariff threat spooks markets
President Donald Trump’s suggestion earlier this week that he could impose “severe” tariffs on Canadian fertilizer has left the industry leery, a fertilizer analyst says.
The comments have “raised alarms across the U.S. fertilizers markets,” Josh Linville, vice president of fertilizers at StoneX, said in an email to reporters. Canada provides 20% of U.S. urea ammonium nitrate imports and 90% of potash imports, Linville said.
“It would hurt,” he added.
Take note: Trump has not followed through on his last threat to hike tariffs on Canada.
Further, when Trump initially unveiled new duties on Canada shortly after taking office, he faced pressure from ag-state lawmakers to exempt potash. The White House eventually reduced the proposed tariff rate for potash and issued a carveout for products covered under the USMCA.
Some in Canada are already accusing Trump of crying wolf. Saskatchewan Premier Scott Moe told reporters in Canada this week that the Trump administration has “no room” to increase costs for U.S. farmers.
“You need to take the president very seriously but maybe don’t take him literally on everything that he say[s],” Moe said, according to Canada’s Global News.
Apple industry worried about trade wars
America’s apple industry can’t afford another round of plummeting exports due to U.S. trade wars, Rep. Kim Schrier, D-Wash., told the House Agriculture Committee on Wednesday.
During President Donald Trump’s first term, retaliatory tariffs from India led to a 99% drop in apple exports to the country from Washington state, the top U.S. producer, Schrier said during the panel's "Member Day" hearing.
While shipments have since resumed, the once $120 million market is still trying to return to normal. “We don’t know if they are going to get all the way back,” she said. “The longer you don’t have a market, the more likely it is that you're going to lose that market permanently.”
Schrier, a physician, also said this week she's reintroducing the Eat Healthy Food From Local Farmers Act, which would allow states to use federal dollars to buy locally grown food from small farmers and get that to local food banks.
Final Word
“If the 15% tariff on EU spirits and wines and the 10% tariff on UK spirits continues, the consequences will be severe. U.S. restaurants and bars, already battling rising costs and declining wine and spirits sales, will be hit with another blow that could trigger even more job losses, reduce consumer choice and stall economic activity across the country.” – An excerpt from a petition urging Trump to lift tariffs on imported alcohol products. It’s organized by the Toasts Not Tariffs Coalition of associations representing the U.S. alcohol and related sectors. The petition, delivered to Trump Wednesday, had more than 21,000 signatures, according to a statement.
Kim Chipman, Oliver Ward and Noah Wicks contributed to today’s Daybreak
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