Closeup of the flags of the North American Free Trade Agreement NAFTA members on textile texture. NAFTA is the world's largest trade bloc and the member countries are Canada, United States and Mexico. 3D rendering with detailed textured grunge effect on closeup.

North American trade deal signed, moves to Congress

Despite the signing of the new trade agreement among the United States, Canada and Mexico Nov. 30, work remains as the focus now shifts to Congress and its ratification. The new free trade agreement that took more than a year of intense negotiations among the three partners to come to fruition.

Officially called the United States-Mexico-Canada Agreement (USMCA) but dubbed NAFTA 2.0, the agreement must be voted on by each country’s legislative body before it takes effect.

“Agricultural exports to Canada and Mexico increased from $8.9 billion to $39 billion under NAFTA,” said American Farm Bureau President Zippy Duvall. “In every way, this new agreement is just as good, if not better than, the one that came before.”

According to AFBF, several provisions in the agreement will have significant impacts on the agriculture industry:

  • USMCA will provide new market access for dairy and poultry products in Canada and maintains the zero-tariff platform on all other ag products and on all ag products to Mexico.
  • Canada agreed to end its Class 7 pricing scheme.
  • U.S. dairy products gain access to an additional 3.6 percent of Canada’s dairy market.
  • Canada agreed to treat wheat imports the same as domestic wheat for grading and pricing, and Mexico and the U.S. agreed that all grading standards for ag products will be non-discriminatory.

USMCA is the first free trade agreement for the U.S. that includes measures that address cooperation, information sharing, and other trade rules related to biotechnology and gene editing. There also are provisions that enhance science-based trading standards among the three nations as the basis for sanitary and phytosanitary measures for ag products, as well as progress in the area of geographic indications.

However, Duvall cautioned that there is still work to be done between the three countries to make the agriculture industry whole.

“As good as all this news is, farmers and ranchers still face retaliatory tariffs over steel and aluminum disputes with our North American neighbors and other trading partners,” he said. “We urge the administration to redouble its efforts to come to an agreement on those outstanding issues so we can regain the markets we had not long ago.”

 

Kelli Milligan Stammen is director of publications for the Ohio Farm Bureau.