Ag Industry Mostly Positive On Japan Trade Deal

The U.S. Japan deal is signed and once Japan’s congress ratifies it. More than 90 percent of U.S. ag imports there will either be duty-free or receive preferential tariff access. Many agricultural groups reacted to the news mostly with cheers, but some with cautious optimism.

Senate ag leaders say Wednesday’s U.S. Japan announcement is significant win. U.S. wheat growers say getting the deal in place by January 1st is critical, given that Japan is the 2nd largest buyer of U.S. wheat and changes in TPP tariff rates effective in 2020 threaten to rob U.S. producers of their competitiveness against growers in Canada and Australia.

Not all ag sectors are quite so enthusiastic. U.S. dairy says many of their goals were not reached in this agreement, though they’re optimistic that ag will remain a part of negotiations with Japan as broader talks continue.

Alan Bjerga, of the National Milk Producers Federation, says, “You see the elimination of tariffs on cheese and whey, that’s a nice start, but I think this does have to be a start. Because of this agreement, the situation for dairy in Japan is better than it was without it, but to really get the full fruits, there is a ways to go.”

While milk producers look forward to working with officials towards a better agreements, Bjerga says the short term effect for growers will be to instill optimism.

“I don’t know what it will do in terms of immediate impact. Clearly it’s good news for the industry, and so you can see that strengthening milk prices. I have no doubt that with the repeals of the tariffs on cheese and weigh that’s going to help US producers make inroads on trade.”

Though 90% of U.S. ag products going to Japan will be duty-free according to USTR, another sector not addressed was rice, which Senator Roberts says is strictly a cultural issue, but one he believes could be worked on more in the future.

Though ag trade was the primary area dealt with in this initial deal with Japan, experts say that doesn’t mean it’s off the table. Bjerga says dairy and other ag sectors will continue to have a voice going forward. The us-Japan agreement on agriculture Won’t need U.S. congressional approval, but as we reported it will not go into effect until it’s ratified by Japan’s legislature. U.S. officials say the goal is to implement the agreement by the first of the year.

Report By: Sarah Mock