In testifying before the U.S. House of Representatives Committee on Agriculture Wednesday, Wythe Willey is an Iowa cattle producer and past president of the National Cattlemen's Beef Association, urged forceful U.S. leadership as trade negotiators enter a critical phase in the multilateral Doha Round of World Trade Organization negotiations.
Market access remains the most important objective for beef producers in trade negotiations. He says U.S. grain-fed beef has a unique place in the global food economy. "The goal of U.S. agricultural trade policy should be to make our product as competitive as possible in the world market.
"Increased market access through tariff reduction is the core mechanism by which U.S. cattle producers can thrive in the global marketplace, Willey says. "For our industry, this ultimately depends on the percentage of tariff reductions in the agreement, since U.S. beef producers receive no domestic supports or export subsidies."
Free trade agreement negotiations reduce WTO bound tariffs--the maximum tariff rates that WTO members may impose on imports. The current U.S. proposal on the table would reduce bound tariffs to around 7.5 to 12.5%. Currently, Japan's bound tariff on beef is 50%; Korea's is 40%; and the European Union is at a whopping 57%.
"In addition, as the painfully slow â€“ 22 plus months and counting â€“ process of reopening the Japanese market to U.S. beef continues, we are also reminded that the reintroduction of U.S. beef will undoubtedly trip Japan's "snapback" or volume safeguard provision," Willey explains. "Once triggered, Japan's tariff on all beef imports will automatically be kicked up to its 50% bound rate for the remainder of Japan's fiscal year, ending March 31. The fact that the total volume of Japanese beef imports will still be significantly below 2003 levels will be irrelevant."
Willey says for U.S. cattle producers to get the maximum benefit from tariff reduction, greater assurances must be made on the part of trading partners to eliminate unjustified sanitary and phytosanitary (SPS) as well as technical barriers to trade.
"U.S. cattle producers believe the WTO is the only mechanism capable of generating the political force necessary to move the agricultural trade reform process forward," he says. "Without forceful U.S. leadership in this multilateral context, U.S. beef producers will undoubtedly suffer under the trade distorting forces of mercantilism and protectionism. We are now at a critical juncture in this process and we urge your support."