Congress recently passed free trade agreements with Colombia, Panama and South Korea. Together, the agreements represent nearly $2.5 billion in new agriculture exports and will create the economic growth that could generate support for up to 22,500 U.S. jobs. Competitors such as Europe, Brazil and Canada already have agreements with these countries.
The South Korea deal, the biggest for the U.S. since the North American Free Trade Agreement in 1994, removes duties on almost two-thirds of American farm exports, according to the American Farm Bureau Federation. The agreement with South Korea alone represents an additional $1.8 billion annually.
For American farmers, the benefits are significant, note various farm groups. The Ohio Soybean Association lists the following benefits of the trade agreements to American farmers:
- Soybeans imported to South Korea for use in cooking oil and livestock feed will enter duty-free.
- South Korea will eliminate the current tariff on soybeans imported for food uses such as for tofu and soymilk.
- Colombia will immediately eliminate a system of variable tariffs on soybean imports, which has imposed tariffs as high as 150%.
- Colombia will phase out its 24% tariff for refined soybean oil throughout the next five years.
- Panama’s current 0% tariff treatment for soybeans and soybean meal will be locked immediately upon implementation of this agreement.
- Panama’s current 0% tariff treatment for crude soybean oil will also be locked immediately, with the 20% tariff on refined soybean oil being phased out in 15 years.