USMCA agreement makes advances after being stuck in limbo

Written by Allison Durheim, KEYC News on December 10, 2019.

WASHINGTON (KEYC) — Announced Tuesday out of Washington: a deal to advance the United States Mexico Canada Trade Agreement.

It’s a revamped version of NAFTA.

A signing ceremony was held in Mexico City on Tuesday with all three nations in attendance to show support for the deal not yet approved by Congress.

“While you might not see it as a direct impact to your pocket or you don’t exactly export something, it really does directly impact us here, whether we believe it or not,” said GreenSeam director, Sam Ziegler.

The agreement between the Speaker of the House, Nancy Pelosi, and United States Trade Representative, Robert Lighthizer, brings new life to the trade agreement between Canada, Mexico and the United States that, before, seemed to be standing in limbo.

“The differences that were out there really didn’t relate to agriculture, they were more along labor issues and some environmental issues,” said Kent Thiesse, farm analyst at MinnStar Bank.

Canada and Mexico are the two largest export markets for the United States for food and agricultural products and the agreement opens up new doors for dairy, poultry, eggs and wheat producers exporting to Canada.

“Canada and the United States had different class systems so it kind of brings those together which will make it easier to transport certain dairy products, especially to Canada, it’ll have a big impact,” said Thiesse.

“There were some differences in how they graded wheat between Canada, which has caused issues over time,” said Thiesse.

Addressing the different grading systems among the two countries helps U.S. producers be more competitive and maintain fair prices.

“This will be the stability in the market to get people to really engage and want to do business in the long term and not as ‘well tomorrow I’ll do it for you because everything looks good,’ to make those long term contracts to increase our trade,” said Ziegler.

Ziegler said the impacts will be seen locally.

“Products are going to Mexico everyday from Mankato from the soybean crushing plants, the DDGS from our ethanol plants are going to Mexico, they’re going to Canada, so this is really important, this is really impactful,” said Ziegler.

The agreement also addresses agricultural biotechnology and biosecurity among the three nations and removed language that protected expensive biologic drugs from generic imitators.

U.S. Secretary of Agriculture, Sonny Perdue, said he wants Congress to pass USMCA by Christmas.

“That would be one of the best Christmas parties our region could ever have,” said Ziegler.

Thiesse said the next step will be getting the deal through Congress to get it on President Trump’s desk.

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