On Oct. 12, the U.S. Senate and the U.S. House of Representatives voted, by a wide margin, in favor of the pending free trade agreements with Colombia, Panama, and South Korea. The agreements are now headed to the president’s desk for final approval. President Obama will sign the Korea, Panama, and Colombia Free Trade Agreements and the renewal of Trade Adjustment Assistance for workers in the Oval Office before making remarks in the Rose Garden on Friday, Oct. 21. In his remarks, President Obama will underscore that these trade agreements will significantly boost American exports, support tens of thousands of American jobs, and protect labor rights, the environment, and intellectual property. President Obama will be joined in the Rose Garden by business and labor leaders as well as workers who will benefit from these bills.
“This is a big win for Montana’s family ranchers,” MSGA Executive Vice President, Errol Rice, said after the agreements were ratified by Congress. “MSGA has been working very hard to get these agreements passed and has been working to increase opportunities for Montana ranchers to export beef to growing markets overseas.”
Last month, Rice was named to a national trade panel to advise the Secretary of Agriculture and the U.S. Trade Representative on trade policy in regards to animals and animal products, including Montana beef. On May 26, 2011, Rice testified at the U.S. Senate Committee on Finance hearing regarding the KORUS Free Trade Agreement. In his testimony, Rice stated: “Ranchers must have access to the additional demand for beef from consumers that live outside the United States. Our ranch families’ livelihoods depend on exports which are our most dynamic and vibrant opportunities for long-term sustainability.”
According to CattleFax, exports create an additional $202 dollars per head to the total value of cattle. According to the U.S. International Trade Commission, annual exports of U.S. beef to South Korea are expected to increase as much as $1.8 billion once the agreement is fully implemented. Implementation of KORUS would phase out over 15 years South Korea’s 40 percent tariff on beef imports, with $15 million in tariff benefits for beef in the first year of the agreement alone and about $325 million in tariff reductions annually once fully implemented.
Colombia is also an important market for U.S. beef and beef variety meat exports. Colombia currently places an 80 percent tariff on U.S. beef imports, making it one of the highest tariffs U.S. beef faces anywhere in the world. The agreement immediately provides duty free access for high quality U.S. beef, reduces tariffs on all other beef and beef products over 15 years, and for the first time ever, puts American beef on a competitive footing with beef imports from Brazil and Argentina.
The FTA with Panama would immediately eliminate the 30 percent tariff on prime and choice cuts and the duties on all other cuts would be phased out over 15 years.