The U.S.-Colombia Free Trade Agreement will go into effect on May 15th. American Soybean Association First Vice President Danny Murphy says the good news about the FTA came sooner than expected this year:
“We expected it would be later in the summer so it’s good news for soybean farmers that we will get this free trade agreement enforced May 15 and we will immediately eliminate tariffs on soybeans and soybean products.”
The agreement will make U.S. soybean farmers more competitive in the growing Colombian market:
“The main benefit is that we will immediately reduce the tariffs that have been charged on soybeans. The tariffs that were between 5 and 20% will be reduced to zero. That effectively means that the price of soybeans in Columbia will be reduced from fifty cents up to two dollars per bushel depending on what tariff rate was charged.
We have a naturally competitive advantage to export the soybeans in to Columbia because of location it is a short trip and they are a growing market and important economy in South America. This reduction of tariff will make us much more competitive than we have been in the past.”
Murphy says the agreement will bring not just a boost to U.S. soybean farmers - but also to the American economy overall:
“It’s estimated that we will increase export value by as much as $1.1 billion. In addition it could mean as many as 20,000 additional jobs to the US economy. That is great news. It’s imperative that people realize how important exports are to our country and how much job growth it does bring when we increase exports.”
Murphy and ASA hope the U.S. free trade agreement with Panama will join the Colombian and recently-implemented Korean FTAs by setting an entry-into-force date for this summer.