New markets equal new opportunities for WI farmers
It’s no secret that when I was growing up, one of my biggest dreams was to become a farmer. I’ve been fortunate enough to live that dream, but for too many of our friends and neighbors, the last decade has turned their dreams into nightmares.
Low commodity prices, wet weather, and the costs of innovation have all taken their toll. Fortunately, new opportunities and the hope that comes with them may provide our farmers with a much-needed boost.
Last month, I had the honor of representing Wisconsin at the signing of the U.S.-Japan Trade Agreement at the White House along with agricultural leaders from across the country. Prior to this agreement, the average Japanese tariff on a U.S. agricultural product to Japan was 17% - but now that’s changing.
This agreement will result in Japan eliminating or reducing tariffs on $7.2 billion of U.S. food and agricultural products. Some items, such as a variety of fruits and vegetables will have the tariffs eliminated immediately. Other items – such as ethanol, frozen poultry, processed pork and egg products – will see tariffs eliminated in stages.
This is a great first step for Wisconsin farmers, with the potential for further progress. The understanding between Japan and our country is that we will continue bilateral trade negotiations, including those dealing with improved access to U.S.
Japan’s appetite for dairy products has grown over the years, and dairy imports to Japan are up 16% this year compared to 2018. The United States share of that, however, has not grown. The European Union has gained market share. Hence, we still have further work to do and that work will continue under this agreement.
Japan is an important market for Wisconsin farmers; it is our fifth leading buyer of agricultural exports. In 2017, we exported $145 million worth of agricultural goods and in 2018, those export numbers increased roughly 21% to $175 million.
This includes increases in meat and prepared vegetables such as sweet corn. The new trade deal is a win for Wisconsin farmers and will result in further increased shipments of these products to Japan. Additionally, Central Wisconsin cranberry and potato growers will benefit from this deal and their market share in Japan should grow as well.
We have more work to do. November 30th will mark the one year anniversary of when Canada joined the U.S. and Mexico in signing the U.S.-Mexico-Canada Agreement (USMCA). However, Congress has failed to act and approve the deal.
As with the U.S.-Japan Trade Agreement, USMCA will be another win for WI farmers. Canada is Wisconsin’s leading export market, purchasing over $1.4 billion in agricultural products, and Mexico comes in only two slots behind at $250 million.
Under the USMCA, Canada has agreed to phase-in increased quota access for U.S. dairy products which include fluid milk, cream, butter, skim milk powder, cheese, and other dairy products. The increased dairy access is estimated to be worth $242 million, and our farmers would likely be the biggest beneficiaries.
Wisconsin farmers exported a wide variety of products to Mexico, and the USMCA will only increase those shipments since this agreement ensures zero tariffs for years to come.
Wisconsin farmers have faced setbacks, but we’re still among the best at what we do. Give us an even playing field, and we can compete with anyone in the world. New deals like this one with Japan or the U.S.-Mexico-Canada Agreement (USMCA) currently before Congress are wins for our country, our state, and our neighbors. I urge everyone to contact your federally elected officials and urge passage.
Rep. Kurtz, R-Wonewoc, represents the 50th Assembly District in western Wisconsin.