House Speaker Nancy Pelosi and U.S. Trade Representative Robert Lighthizer announced an agreement on a modified North American trade pact on Tuesday, Dec. 10.
According to the Associated Press, Pelosi said the U.S.-Mexico-Canada Agreement is a “significant improvement” from the previous North American Free Trade Agreement.
President Donald Trump tweeted, “It will be the best and most important trade deal ever made by the USA. Good for everybody – Farmers, Manufacturers, Energy, Unions – tremendous support. Importantly, we will finally end our Country’s worst Trade Deal, NAFTA!”
America’s great USMCA Trade Bill is looking good. It will be the best and most important trade deal ever made by the USA. Good for everybody - Farmers, Manufacturers, Energy, Unions - tremendous support. Importantly, we will finally end our Country’s worst Trade Deal, NAFTA!— Donald J. Trump (@realDonaldTrump) December 10, 2019
NAFTA eliminated many tariffs and trade barriers between the three countries and, according to the AP, was branded as a job killer as companies chose to move jobs to Mexico and ship goods back to the U.S. duty free.
The U.S. Department of Agriculture stated, “All food and agricultural products that have zero tariffs under the North American Free Trade Agreement will remain at zero tariffs. Since the original NAFTA did not eliminate all tariffs on agricultural trade between the United States and Canada, the USMCA will create new market access opportunities for United States exports to Canada of dairy, poultry, and eggs, and in exchange the United States will provide new access to Canada for some dairy, peanut, and a limited amount of sugar and sugar-containing products.”
Nearly 1,000 American food and agriculture organizations announced their support for the USMCA earlier this year.
“USMCA is a big win for American workers and the economy, especially for our farmers and ranchers. The agreement improves virtually every component of the old NAFTA, and the agriculture industry stands to gain significantly,” U.S. Secretary of Agriculture Sonny Perdue said in a statement. “President Trump and Ambassador Lighthizer are laying the foundation for a stronger farm economy through USMCA and I thank them for all their hard work and perseverance to get the agreement across the finish line. While I am very encouraged by today’s breakthrough, we must not lose sight – the House and Senate need to work diligently to pass USMCA by Christmas.”
According to the USDA, Canada and Mexico are the first and second largest markets for U.S. food and agricultural products with a value of more than $39.7 billion in food and agricultural exports in 2018 and supporting 325,000 American jobs.
In the agreement, Canada agreed to eliminate the Class 6 and 7 milk-pricing programs that American dairy farmers had deemed unfair as the programs allowed Canadian farmers to undersell U.S. producers. Canada also agreed “to terminate its discriminatory wheat grading system” which will allow U.S. wheat growers to be more competitive.
The USMCA also specifically addresses biotechnology “to support innovation and reduce trade-distorting policies.”
National Corn Growers Association President Kevin Ross said in a statement, “NCGA’s top legislative priority in 2019 has been passing USMCA. Today’s announcement brings us one step closer to ratifying this important agreement and securing the future of our trading relationship with Mexico and Canada, the top export market for U.S. corn farmers. It’s been a brutal year for many farmers who really need the certainty this would provide for agricultural trade.
“NCGA appreciates the bipartisan efforts between Speaker Pelosi, Ambassador Lighthizer and the House working group to reach an agreement. I urge lawmakers to pass USMCA and help us close out 2019 with a win for American’s farmers and the U.S. economy.”
The National Pork Producers Council also applauded the agreement and called for Congress to vote, citing its importance as Canada and Mexico accounted for over 40 percent of U.S. pork exports last year.