After Trump pulled the TPP plug, he’s taking a look at NAFTA
Share Facebook Twitter Google + LinkedIn Pinterest The American Farm Bureau Federation (AFBF) is taking President Donald Trump’s more protectionist moves on trade this week in stride, despite AFBF’s long-held support of the Trans-Pacific Partnership (TPP)Trump’s executive order to withdrawal the United States from TPP is not what the nation’s largest farm organization wanted, but it was no surprise after President Trump vowed to make that a priority during his campaign. Many in agriculture are now wondering what the new administration has planned for other trade deals, namely the North American Free Trade Agreement (NAFTA).“When NAFTA was first implemented, the U.S. had only $9 billion of ag exports with Mexico and Canada,” said Dave Salmonsen, Trade Adviser with the AFBF. “Today that number is $38 billion, so this trade deal has been beneficial to agriculture.”Leaders of both Mexico and Canada are open to new talks about trade. Those conversations will deal largely with manufacturing, though agriculture is also expected to come up.“There are some issues in the ag sector that we could move forward with, including remaining border barriers from Canada on dairy and poultry exports,” Salmonsen said. “If everything is back on the table we also have some issues with Mexico to hash out.”With recently becoming the number one corn importer, Mexico is proving to be an important market for U.S. farmers. In the 2015-16 crop year, Mexico imported nearly 13 million tons of corn. During the 2016 calendar year that number is 14 million tons, accounting for two straight years of record corn imports Mexico, knocking Japan out of the corn customer top spot.“It would be a pretty bad situation for American farmers if NAFTA was weakened or changed or thrown out of the window,” said Ryan LeGrand, the U.S. Grains Council director in Mexico. “What you would probably have is an increase in tariffs and that would cause Mexico to look south to Brazil and Argentina for more of their corn, cutting into our market share and eventually affecting the price of U.S. corn.”Mexico has the potential to grow as an importer of U.S. grains in the future, according to LeGrand.“Mexico’s animal producers are very technologically advanced, they’re progressive and they’re growing,” he said. “That means more production for Mexico and more need for grains, which should be U.S. grains as long as we keep NAFTA in place.”Commerce Secretary nominee Wilbur Ross, U.S. Trade Representative Robert Lighthizer and White House Trade Council head Peter Navarro, will negotiate the new bilateral trade deals with countries once related to the TPP, while Trump will meet soon with Canada and Mexico’s leaders on NAFTA.