OPINION The United States-Mexico-Canada Agreement took effect July 1, at a crucial time for farmers and ranchers struggling to recover from COVID-19 losses and a depressed agricultural economy. The expected $2 billion annual increase in U.S. agricultural exports and overall increase of $65 billion in gross domestic product will provide a welcome boost.
The U.S. Department of Agriculture estimates COVID-19 contributed to a $50 billion decline in commodity value alone for 2019, 2020 and 2021 production totals. That doesn’t include all of agriculture’s losses, which would be billions more.
The launch of the new agreement brings optimism to the country’s farmers and ranchers at a time they need it the most. We’re grateful for the opportunity to build on the success of the North American Free Trade Agreement and we’re eager to see the results on America’s farms. It’s important that our neighbors uphold their end of the deal so the agreement provides a stabilizing force amid the unpredictability of a pandemic in all three countries.
Under the United States-Mexico-Canada Agreement, Canada will increase quotas on U.S. dairy products, benefitting American dairy farmers by $242 million. Canada will also treat wheat imports the same as domestic wheat for grading purposes. Mexico has also agreed that all grading standards for ag products will be non-discriminatory. The agreement also enhances science-based trading standards among the three nations.
The United States-Mexico-Canada Agreement is not a magic bullet for all the challenges facing agriculture. A University of Florida study shows Mexico gaining ground in imports of produce like tomatoes, strawberries and bell peppers. The new agreement doesn’t alter the rules for imports of produce from Mexico. The Farm Bureau supports the United States Trade Representative and USDA field hearings to receive grower input on the issue.
As with all trade agreements there are some areas that still need attention. We will continue to work with the administration to level the playing field for fruit and vegetable growers facing increased competition from Mexico.
Canada is our nation’s second-largest trading partner. Mexico is our third-largest trading partner.