An accord expected to boost U.S. farm exports to Japan may not be complete in time for signature by President Trump and Prime Minister Shinzo Abe on the sidelines of the UN General Assembly this week. The so-called mini-deal would cover agriculture and digital trade but is being held up by Tokyo's request that the United States promise not to impose tariffs on cars imported from Japan.
The U.S. food and agriculture sector would lose nearly $22 billion in exports, equal to 15 percent of this year's sales forecast, if the United States scrapped NAFTA without a replacement on top of withdrawing from TPP, said three Purdue economists in a report on Monday. "Under this more pessimistic outcome, the negative trade impacts would be reflected in lower incomes for U.S. farmers, reduced land returns and labor displacement."
With the trade war stunting U.S. farm exports after two years of growth, President Trump said he has asked China to remove its retaliatory tariffs on U.S. food and ag exports. Trump announced the request on the same day four large farm groups opened their annual meetings with a joint endorsement of the new North American trade pact negotiated by the White House.
Three groups that promote U.S. farm exports say the upcoming U.S.-Japan trade talks are a chance to gain ground against Australia, Canada, and the EU, which will benefit from free trade agreements with Japan.
The United States and Japan will open negotiations on a free trade agreement “that can produce early results” on manufactured goods, announced President Trump and Prime Minister Shinzo Abe on Wednesday. Japan, however, said that in the upcoming negotiations it would not lower tariffs on food, agriculture, and fishery imports.
Three Republican senators said on Thursday that re-entering the Trans-Pacific Partnership could speed up the process of finding alternative markets for farm exports now that China has closed its door to them.
U.S. Trade Representative Robert Lighthizer told senators on Thursday that “hopefully, we are in the finishing stages” of negotiating the new NAFTA. At the same time, he said Japan is balking at writing a trade agreement with the United States and the administration has yet to start talks with other Pacific Rim nations as an alternative to the Trans-Pacific Partnership.
When Japan and the United States begin a new round of trade talks, Prime Minister Shinzo Abe said, they should be in the format of the Trans-Pacific Partnership, the free trade agreement that was the bête noire of President Trump’s campaign.
A year to the day after President Trump pulled the United States out of the Trans-Pacific Partnership trade pact, the remaining 11 nations, which include Australia, Japan, Canada, and Mexico, completed a free trade agreement of their own.
More than 60 percent of U.S. red meat exports go to countries involved in NAFTA or TPP, says the U.S. Meat Export Federation, part of the chorus of livestock and meat industry groups worried by the Trump administration upheaval of trade agreements. "The honeymoon with many in agriculture was over before it ever really began, it appears," says Beef magazine, adding, "And many in ag don’t like it."