A new report out this week from the International Trade Commission (ITC) on the likely impacts of the Trans-Pacific Partnership (TPP) agreement predicted that exports of U.S. corn to the 11 other member countries would rise slightly, an impact magnified by additional exports of value-added products like meat and dairy that use corn.
The report showed clear benefits from TPP to the U.S. food and ag sector once its tariff reductions are fully implemented, as well as positive impacts to the overall U.S. economy with exports set to increase by $57.2 billion annually by 2032.
“While exports of U.S. corn worldwide, not just to TPP countries, would go down by an estimated $31 million, or 7.8 million bushels, additional market access for beef, pork, poultry and dairy would significantly increase, which is line with projected shifts to value-added exports,” said Mike Dwyer, USGC chief economist.
The report expects U.S. beef exports to increase by $876 million, pork by $219 million and poultry by $174 million, for a total meat export gain of almost $1.3 billion.
“The additional corn demand generated by more exports of beef, pork and poultry will cause U.S. production of corn to increase by $207 million,� Dwyer said. “At current prices, that is roughly 1.3 million tons (51 million bushels).�
The Council works throughout the TPP region to promote U.S. coarse grains, ethanol and co-products and participated in the TPP negotiations on behalf of the U.S. feed grains industries.
The ITC report is a critical next step toward approval of the new agreement, which will have even more positive impacts than estimated because it could not fully consider the economic impacts of challenging-to-predit but costly non-tariff trade barriers.
“This report is evidence that we need to see TPP implemented soon,â€� Dwyer said. “The ITC did a commendable job of taking into account the many factors that impact the global grain trade.”
For TPP to go into effect, at least half of the 12 TPP nations representing 85 percent of the total gross domestic product of the members have to ratify the deal – which effectively means the United States must approve it.
The National Corn Growers Association called for TPP consideration by Congress following the release of the report, reiterating its earlier support for quick passage.
The full report is available here.
More information about TPP is available from USDA’s Foreign Agricultural Service, the Office of the U.S. Trade Representative and the Trade Benefits America Coalition.