WASHINGTON, Oct. 18, 2016 - Farm groups are still dissecting
the collection of new trade measures by the White House Friday to
strengthen ties with Cuba. The announcement last week was met with some praise
for measures like one that removes financing restrictions on tractor and
pesticide sales to Cuba, but general conclusion that it’s going to take an act
of Congress before U.S. farmers start to see major benefits.
"While we think the Administration's tweaks to Cuba-related regulations are a sign of goodwill, U.S. agriculture has been excluded again and we just became the most disadvantaged industry in this situation," Ben Mosely, vice president of government affairs for the USA Rice Federation, said in a statement Monday. "This move further solidifies how singled out U.S. farmers are within the Cuba discussion; we can now buy their prized exports like rum and cigars but they can't buy our crops? It's up to Congress to act this year to level the playing field for U.S. ag, giving us the same ability to extend credit that other products now have."
As it is now, Cuba must pay cash upfront or secure third-party financing before it can buy U.S. corn, soybeans, wheat, dairy, rice or poultry. Cuba – just 90 miles offshore - was once a major buyer of U.S. rice, but the finance restrictions put U.S. exporters at a sharp disadvantage with countries like Vietnam.
National Farmers Union President Roger Johnson also called on Congress to act, but stressed that the efforts so far by the White House to engage Cuba will be key to cementing future trade.
“The combined action since the President announced his Cuba policy directive nearly two years ago has paved the way towards improved trade relations and market access,” Johnson said. “We continue to call on Congress to lift the remaining restrictions in the Trade Sanctions Reform and Export Enhancement Act so that family farmers and ranchers can benefit from the expanded engagement with Cuba’s consumers.”
China’s demand for beef continues to grow. China announced in September that it was willing to lift its ban on U.S. beef, but before that can happen negotiators from both countries must agree to regulations that will govern the new trade. For U.S. beef exporters, that can’t happen soon enough. The U.S. has been cut off from the Chinese market for 13 years and it continues to grow as China’s middle class and purchasing power expands.
USDA’s Foreign Agriculture Service said in a newly released report that it is now forecasting Chinese beef consumption this year to reach 7.6 million tons, a 100,000-ton increase over an earlier prediction. The agency said it expects consumption to rise to 7.9 million tons next year.
“On the demand side, China’s continued urbanization, growing middle class, and changing consumption preferences continue to drive demand,” the agency said in the report.
China’s imports are growing even faster. The FAS report predicts China will increase its beef imports by about 20 percent next year to 950,000 tons, up from 800,000 tons this year.
The USDA agency said that if China resumed buying U.S. beef next year, the amount would likely be small. Brazil recently pushed out Australia as the largest beef supplier to China and it will be difficult to compete with the inexpensive South American product.
Report shows that ag marketing programs create revenue. A 139-page report released Monday shows that farm bill-funded marketing programs to promote U.S. agricultural commodities overseas are well worth the investment.
The report, which was sponsored by the U.S. Wheat Associates, the USA Poultry & Egg Export Council and the Pear Bureau Northwest, concluded that USDA’s Market Access Program (MAP) and Foreign Market Development (FMD) program help generate billions of dollars in new sales to foreign customers every year.
Promotion activities through MAP and FMD help generate an average of about $8.2 billion in additional farm commodity exports every year from 1997 through 2014, according to the study that was conducted by Informa Economics.
“In other words, these programs have accounted for 15 percent of all the revenue generated by exports for U.S. agriculture over that time,” said Gary Williams, an agricultural economics professor at Texas A & M University and lead researcher for the study.
USDA lifts ban on some citrus from Morocco. USDA’s Animal and Plant Health Inspection Service has lifted an eight-month ban it placed on Moroccan tangerines, clementines, mandarins and sweet oranges. The agency shut down imports on Jan. 29 after U.S. Customs and Border Protection inspectors found live Mediterranean fruit fly larvae in a shipment of clementines that arrived in Philadelphia.
The ban took a major toll on Moroccan exports, but USDA officials soon began working with their Moroccan counterparts to come up with a way to restart trade. A new trade protocol with increased protections against infestation was reached and USDA said Monday that Morocco can resume exports so long as each shipment is “accompanied by a Phytosanitary Certificate with an additional declaration that the consignment was produced and prepared for export in accordance with the citrus operational work plan.”
Moroccan citrus exports to the U.S. this year have been less than half what they were in 2015, according to USDA data. The reversal on the clementine ban should help Morocco get back on track. The North African country shipped about $95 million worth of citrus to the U.S. in 2015, a 34 percent increase from $71 million in 2014.
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