The Obama administration appears confident the 12-nation Trans-Pacific Partnership (TPP) is headed for passage in Congress. That doesn’t mean, however, it won’t come without a fight as Agriculture Secretary Tom Vilsack admitted in a Feb. 23 press conference.
Speaking to reporters, Vilsack and Zippy Duvall, new president of the American Farm Bureau Federation, pushed a new AFBF study showing U.S. agriculture would receive a major boost from the trade deal.
According to the AFBF, “farm-price increases for corn (5 cents per bushel), soybeans (12 cents per bushel), wheat (2 cents per bushel) and rice (16 cents per hundredweight). While cotton prices are not projected to change, cash receipts are projected to increase by $21 million.
“AFBF also predicts price increases for beef ($2.66 per hundredweight), pork ($2.45 per hundredweight) and poultry ($1.40 per hundredweight). In the dairy sector, prices will increase for butter ($2.81 per hundredweight), cheese ($1.68 per hundredweight), nonfat dry milk ($1.29 per hundredweight) and all milk (21 cents per hundredweight).
“Net trade is expected to increase for rice, cotton, beef, pork, poultry, butter, cheese, soybeans and products and non-fat dry milk.
“While the analysis projects that the net trade for corn will decline by 45.3 million bushels, overall demand and use for corn is forecast to increase by 54.2 million bushels. Corn revenues are expected to rise by $680 million per year and prices are projected to rise by 5 cents per bushel, due to higher domestic feed use from additional beef and pork exports created by TPP.”
Vilsack said “every $1 billion in ag sales helps to support 6,500 jobs. So, in addition to $4.4 billion in increased income to our farmers and ranchers, we’re also looking at supporting over 30,000 high-paying jobs.”
How would the TPP handle trading partners unwilling to provide unfettered access to U.S. commodities due to issues with seed technology or animal husbandry practices?
“This is the first agreement I’m aware of that addresses the importance of sanitary and phytosanitary rules are based on science and documented information,” said Vilsack. “Second, this is the first agreement that makes specific reference to biotechnology and the importance of having a uniform approach.
“This will help us in terms of the Asian market and put pressure on our Chinese friends to standardize their regulatory process, which has been – and continues to be – problematic for us. When China, or any other country, creates a barrier to valid and recognized science across the world it clogs the pipeline of innovation.”
What is the expected timeframe for the expected boost of $4.4 billion to $5.3 billion?
“Those numbers represent annual income, or fees,” said Duvall.
Asked when the TPP will be taken up by Capitol Hill, Vilsack pushed lawmakers to take up the deal quickly. “Delay is costly. It’s costing American farmers and ranchers. The reality is there are soft commodity prices and nothing will boost them like expanding markets and tearing down tariff barriers. … We know from this study that agriculture will benefit specifically. (A second) study says a delay of a single year of implementation will mean a $94 billion hit to the economy overall. We need to get those 30,000 jobs into the mix in rural America.
“Obviously, this is an issue that has created an interesting political dynamic. There are people on the extreme right and people on the extreme left who’ve been opposed to (TPP). It’ll be necessary for those in the middle – as it almost always is – to get the coalition together to pass this. It’s similar to what happened with the TPA (Trade Promotion Authority), which provides for an up or down vote on TPP.”
Vilsack pointed to the recent passage of the Customs Trade Bill as a positive sign for the TPPs chances. Customs bill “passed both the House and Senate with strong majorities and will provide greater enforcement mechanisms. Some of the concerns people have about trade involve the enforcement of these trade agreements. I think they can be reassured with the passage of a strong, amplified, beefed-up customs effort that will see continued strong enforcement by (the Obama) administration and future administrations.”
Among those unimpressed with Vilsack’s claims is Roger Johnson, National Farmers Union president. “While access to global markets is important for American agriculture, a trade agreement that does little to fix currency manipulation, reign in foreign predatory trade practices, or improve the $531 billion trade imbalance is not the solution.
“In its current form, the TPP stands to hurt our rural economies by pitting American jobs against foreign labor that is paid mere pennies per hour. Beyond the farm gate, any consumer that cares about where their food comes from should be concerned with the TPP.