Fold a typical map of the world in half, and you will find the territory managed by the U.S. Grains Council’s (USGC’s) regional office in Panama City – the more than 5,000 miles south from Central America to Cape Horn in Chile, plus the United States’ northern neighbor, Canada, and the islands of the Caribbean.
The countries making up this massive region buy a fifth of all U.S. feed grains in all forms and represent some of the most important areas of existing trade policy to U.S. agriculture today. One key market, Colombia, will be the host to the Council’s annual International Marketing Conference in February.
Marri Tejada, the regional director for this exciting and challenging part of the world, discusses what she is seeing in the region, here.
Give readers an overview of what you do – your programs, staff, operations.
My office covers the Western Hemisphere excluding Mexico, including Canada, all of Central and South America and the Caribbean. We have representatives in places including Canada, Costa Rica, Colombia, Brazil and Argentina. Our programs, of course, include feed grain and ethanol programs.
We have a very robust range of program types, including trade policy – mostly market defense – market expansion, finding new markets for our products and customer servicing, keeping close contacts with our current customers.
What are the top priorities you are seeing in the Western Hemisphere right now?
Market defense is a top priority right now. A lot of my time is spent on dealing with two current trade constraints including active countervailing duties (CVD) cases in Peru, potential cases in other parts of the region and issues with trade product codes in Colombia and other countries. Much of our focus is on defending existing markets in Colombia, Peru, Brazil, and we were also part of the negotiations for the new U.S.-Mexico-Canada Agreement, which included Canada.
Another key priority is market expansion, especially for value-added products like ethanol and distiller’s dried grains with solubles (DDGS). The ethanol portfolio has been exciting because everything is new – new customers, new client base, totally new discipline, areas of expertise, new trading method, new government entities we are in contact with and more.
We are also focused on customer serving. Colombia, Peru and Central America are big players in our export market. It’s a top priority to maintain our existing customer relationships.
How have your priorities in the region changed in recent years?
Ethanol clearly changed a lot in our region. When I came down here in September of 2014, the Council was just beginning ethanol programs, and our scope was very limited. Now, we are looking everywhere, requiring a lot more time, attention and resources.
The other thing that’s changed is the trade policy constraints we’ve been facing. We have two CVD cases, policy concerns about ethanol, and protectionism throughout the region. We have to be engaged on the ground to mitigate these problems when they come up. Unfortunately, sometimes your hands are tied. A great success we have experienced on this front, though, was the corn issue in Colombia. There are a lot of times when we are able to save a market, which is essential to demand. That’s what we are here for – defending our markets.
What do you most want farmers to know about your region?
The region has really important markets, although some of them are small. For instance, in CAFTA-DR [a regional trading area with which the United States has a free trade agreement], all of those markets are small, but there’s a lot of boat sharing, where people in Honduras, Guatemala, El Salvador, etc. share a boat. Of course we also have large markets to, like Colombia and Peru.
We have existing free trade agreements with 12 countries in the region, including CAFTA-DR, NAFTA [the North American Free Trade Agreement] and other FTAs. This means we have really good market share and really good trade policy foundations.
The Council’s coming winter meeting will be in Cartagena, Colombia. Give readers some background about that country and market.
We have a free trade agreement with Colombia that was ratified in the spring of 2012. This was a very good deal for grain exports; looking at a chart of before and after the FTA, corn exports from the U.S. were very strong until several years before the FTA was active, when we dropped down to almost nothing. After 2012, it gradually spiked beyond even where it had been. The opposite is true for Brazil and Argentina.
Of course, the agreement is good for Colombia, too. Colombia gets access to a product they have to import, from somewhere. They are now getting a better rate and a better deal. And there’s demand still left to build.
Why is Colombia an important market for U.S. farmers?
The size and potential in Colombia make it worth watching.
Colombia is a big country, 45.5 million people. We did a study a few years ago about Colombia’s feed demand future. What we saw is that Colombia could be the new Mexico; where Mexico is now could be where Colombia is by 2030. Obviously Mexico is a huge and important market for feed demand. Colombia following that trend makes it even more interesting.
Colombia is an important user of sorghum; they know sorghum well, having learned from the Argentinians. There are some buyers who built their entire systems around sorghum. They know the product and will buy it when the market makes sense.
When the FTA’s tariff rate quota (TRQ) finishes in 2022, it will be a zero duty market for corn and sorghum. That’s coming up quickly!
And the Grains Council’s involvement in Colombia over the last three decades is a long-term success story for our organization and our industry, from a backyard production industry to a growing and sophisticated feed market. We were there all that time; we were helping.
What do you want farmers to know ahead of our meeting there in February.
Colombia today is not necessarily what some of our visitors may expect. The longtime warring factions in the country have signed a peace treaty; a former president received the Nobel Peace Prize. In 2018, Colombia became part of the OECD [Organisation of Economic Cooperation and Development], a major global body. The change Colombia has undergone has been transformational.
Colombia is a wonderful, beautiful country with great people. We are excited to have so many members there and see this as an opportunity also to say thank you to some of the key players in a big market, which we don’t often have the opportunity to do in this way.
We will be having a customer appreciation event during our meeting, to which we invited the top VIPs in the Colombian agriculture and fuel industries. We will have a two-hour general session to talk about the changes in the country, including how far Colombia has come and what we have done together during that process.
I’m really excited to see everyone and to show off this great market!
About the U.S. Grains Council
The U.S. Grains Council develops export markets for U.S. barley, corn, sorghum and related products including distiller’s dried grains with solubles (DDGS) and ethanol. With full-time presence in 13 key markets and representatives in an additional 15 locations, the Council operates programs in more than 50 countries and the European Union. The Council believes exports are vital to global economic development and to U.S. agriculture’s profitability. Detailed information about the Council and its programs is online at www.grains.org.