Smith: The U.S.-Mexico-Canada Agreement is fully implemented, taking the place of the North American Free Trade Agreement, which was negotiated during the Clinton Administration. John Newton, Chief Economist at the American Farm Bureau Federation, says given all the challenges U.S. agriculture has faced in recent years, the USMCA couldn’t take effect at a better time.
Newton: On the back of a struggling farm economy, on the back of the COVID-19 pandemic, this is welcome news, improving what’s been a long and successful agreement for U.S. agriculture. Farmers were excited about USMCA implementation. We have three wins on the trade front last year when you think about the Phase One agreement, about USMCA, and the Japan-U.S. agreement. So, farmers are very excited, especially the wheat producers, dairy producers, and poultry producers. They’re going to get better and more fair access into the Canadian market.
Smith: Newton says the agreement gives U.S. farmers and ranchers access to two of America’s most important trading partners.
Newton: Canada and Mexico were our top two trading partners in 2019, in terms of the total economy, and then when you look at agriculture in 2019, again, Canada and Mexico were our top two trading partners. So, NAFTA proved to be very good for U.S. producers and with the improvements we see in USMCA, it too will be a great agreement for U.S. agricultural producers.
Smith: Thanks to the agreement, Newton says U.S. farmers and ranchers will be more competitive in trade moving forward.
Newton: Not only does USMCA make trade with Canada more fair on the wheat front, dairy front, and poultry front, but we also update non-tariff and science-based parameters within USMCA; things like SPS, GIs, in terms of product names. So, there are a lot of improvements in this trade agreement that should make U.S. agriculture more competitive in our top markets.
Smith: Chad Smith, Washington.