It was recently announced that the long-awaited Colombian Free Trade Agreement will go into effect on May 15th. Assistant Director of International Marketing for North Carolina Department of Agriculture Peter Thornton says that the Colombian market probably won’t be as lucrative for North Carolina as some others have been:
“The primary grains that are being discussed are corn and wheat. There are opportunities for exporting those products but I don’t believe Colombia is going to be a containerized market, which is what we export our products in.”
On the other hand, Thornton says that while the grain market may languish, the pork market will not:
“The largest sector that we do export is going to be pork and that does open up opportunities. Right now without the Free Trade Agreement we face increasing competition from our southern neighbors, so this will help us to compete in Colombia.”
The South Korean Free Trade Agreement, in effect for about six weeks now, will, over time, be very beneficial for NC producers in several areas, according to Thornton:
“Any number of products, especially in the value added products like pork poultry tobacco and perhaps even soybeans would have an opportunity in Korea that we wouldn’t have otherwise.”
The effects of the implementation of a free trade agreement are not immediate, with tariffs decreasing over a period of months or years. Thornton says that this point it’s a waiting game for products going into South Korea:
“As the tariffs decrease, of course they will increase correspondingly. I suspect the salesman and our largest producers know exactly when those dates are and exactly when they are competitive and it will happen just as soon as the barriers come down.”
One thing that NC producers would like to see leave the country on an ever increasing basis is poultry. Thornton says it’s a situation that’s not necessarily economically based:
“The poultry market is a highly political market. As countries need it they will import it. And when they want to try to control it they will find non-tariff barriers. When you look at restrictions like those going into China, as those increase then all of a sudden exports to neighboring countries bordering China tend to increase. Then the overall number of exports may go down but it’s nowhere near the amount originally banned because of the trade barrier. It’s more of a political question.”
And poultry isn’t the only protein that’s mired in politics, says Thornton:
“I would say all meat products are involved in politics because on one end countries want to protect their growers and foster their meat industry. On the other end thy know when they get in to a trade dispute, the first thing you go after is agriculture.”
Peter Thornton, NCDA’s Assistant Director of International Marketing.
|