AUCKLAND, NEW ZEALAND — Ministers representing the 12 nations in the Trans-Pacific Partnership (TPP) signed the agreement on Feb. 4 in Auckland, New Zealand.
After five years of negotiations among representatives of Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the U.S., and Vietnam an agreement was reached for the Asia-Pacific Region. The agreement now must go through approval processes in the 12 nations.
Agricultural organizations and companies that do business in that region of the world reacted to the signing, saying the agreement will be beneficial to world trade.
In 2014, the U.S. exported more than $10 billion in feed, feed ingredients and pet food, including soybean meal, corn co-products and other feed additives, the American Feed Industry Association (AFIA) said. Sixty percent of those exports go to TPP countries.
"U.S. exports to the Asia-Pacific region have grown, but the share of U.S. trade in that area has declined relative to other countries because countries in that region have bilateral or regional free trade agreements with U.S. competitors," said Gina Tumbarello, AFIA director of international policy and trade. "For example, a recent USDA report found the Japan-Australia trade deal could result in a $100 million loss in exports to Japan. Ratifying TPP would significantly reduce this effect.
Cargill believes the TPP will help to create a more robust and secure international food supply.
“We look forward to the passage of the TPP by the U.S. Congress in 2016. It is an economic and social imperative for all the economies involved,” said David MacLennan Cargill’s chairman and chief executive.
The nation’s that signed the TPP agreement account for 40% of the global GDP and one third of world trade.
“Our goal is to enhance shared prosperity, create jobs and promote sustainable economic development for all of our nations,” the signatories said. “The signing of the agreement signals an important milestone and the beginning of the next phase for TPP. Our focus now turns to the completion of our respective domestic processes.”
Brian O’Toole, U.S. Wheat Associates’ (USW) chairman, and a wheat farmer from Crystal, North Dakota, U.S. said swift consideration and approval is needed because every day that implementation is delayed, wheat exporters face tariff disadvantages that undercut their ability to compete in established and new markets. said
With duty-free access under its free trade agreement with Vietnam, for example, Australia currently enjoys a $12 to $15 per tonne price advantage over U.S. wheat. U.S. wheat exports are at a tariff disadvantage in a number of other countries that want to join TPP but cannot apply for membership until after the U.S. Congress and the governments of the 11 other countries ratify the agreement, USW said.
“This agreement will strengthen America’s influence in the Asia-Pacific region and set the tone for future international trade agreements, such as with the European Union,” the National Corn Growers Association (NCGA) said. “By supporting TPP, Congress can send a powerful message: the United States will lead on trade. That’s why NCGA members will be going to Capitol Hill in the coming months, asking Congress to vote in favor of the Trans-Pacific Partnership agreement in 2016.”