Last week, U.S. Grains Council Chairman Rick Fruth lead a team of 10 USGC officers, board members and staff on a mission to evaluate grain market opportunities in the Caribbean and Latin American regions. The delegation spent the week meeting with government officials, customers and industry experts in the Dominican Republic, Colombia and Panama. According to Fruth, the mission was received “extremely wellâ€� by feed grain end-users and potential customers in the region. Fruth, however, expressed shock at the scope of lost grain business and trade in Colombia due to the failure of the United States to ratify the U.S.-Colombia Trade Promotion Agreement (CTPA). 

USGC Treasurer and Illinois corn farmer Wendell Shauman said, “I was stunned at the volume and value of lost corn sales to Colombia from 2008 to 2009. Not only did we deprive U.S. corn growers of almost $314 million in corn sales, but the impact on our barley and sorghum members, and our wheat and soybean colleagues, was equally stark with additional losses of between $200 and $300 million.�

USGC Secretary and Montana barley producer Don Fast, stated, “More appalling is the negative impact the lack of free trade agreement is having on our allies and neighbors in the region. The reluctance of the U.S. Administration and Congress to pass the CTPA already approved by Colombia is responsible for directly increasing the cost of food products to the Colombian people. In a country where 60 percent of the population lives below the poverty line, any tariff barrier effectively gets passed on to the population in the form of higher feed and food prices.�

The team was made aware that Colombia’s imports of white corn imports from the United States face a 40 percent import tariff. All of this corn is destined for the lowest economic strata in the form of pre-cooked corn porridge. Fruth said, “If the intent of U.S. foreign policy is to bolster the economic development of our friends and allies in the Latin American region, the failure to ratify the CTPA does not just penalize U.S. farmers, it penalizes our business partners while bolstering the messages of those forces in the region who are antagonistic to the United States.�

Thomas C. Dorr, USGC president and CEO, indicated that the absence of a signed free trade agreement in Colombia is threatening U.S. trade with other countries in the region. For example, the Dominican Republic, where the United States typically holds a 100 percent market share, imported a shipment of corn and soybean meal from South America in 2009. “The lack of CTPA is fostering change in trade patterns in this area, eroding the U.S. market share. The longer the U.S. Administration waits to pass this agreement, the more U.S. markets will diminish, resulting in a lower bottom line for U.S. producers,� said Dorr. “The question remains as to the Administration’s perception of urgency, when CTPA will be signed, and at what social and market consequences to our Latin American friends and farmer members.�