MWFPA, and a collection of MN’s leading agribusinesses and agriculture-related trade associations, has called on Congress to ratify the United States-Mexico-Canada Trade Agreement (USMCA).
The USMCA, signed by the three countries in November 2018, was crafted as a replacement and update to the 1993 North American Free Trade Agreement (NAFTA). It still must be ratified by Congress.
“At $1.6 billion in 2016, Minnesota’s combined agricultural exports to Canada and Mexico exceed or exports to China,” the groups state in a letter sent the state’s congressional delegation. “Ratifying this new trade agreement is critical to ensuring access to these markets.”
The letter also notes the adverse effect of Section 232 tariffs on imported steel and aluminum. Early in the NAFTA renegotiation process, President Trump placed steel and aluminum tariffs on Canada and Mexico under a rarely used national security authority, known as Section 232 of the Trade Expansion Act of 1962
Food manufacturers are concerned about these tariffs because they increase the cost of tinplate steel – a unique type of steel that is specifically made for food cans. The tariffs have left food manufacturers unable to get the raw materials they need domestically because U.S. suppliers do not make the specialized steel and aluminum that the companies require.
“The Section 232 tariffs on steel and aluminum have been devastating to the canned food industry which includes meat, poultry and vegetable products, all areas in which Minnesota is a leader,” said MWFPA President Nick George. “In some cases, the tariffs have made canned products uncompetitive and have allowed foreign products to take market share. Once market share is lost, it is hard to regain,” added George.
U.S. Republican Chuck Grassley, who chairs the United States Senate Finance Committee, said last month there was no chance of ratifying the new trade pact until the tariffs were gone.