U.S. Wheat Associates says a trade deal with Japan would allow U.S. wheat to fairly compete with wheat from other nations exported to Japan.
Currently, under the Comprehensive and Progressive Trans-Pacific Partnership, Japan’s effective tariffs on Canadian and Australian wheat imports are discounted and will continue being discounted to the tariff on U.S. wheat imports. Japanese flour mills prefer and choose to source 50 percent of their annual needs, almost three million metric tons per year on average, of wheat from the United States.
The CPTPP will grant preferential access to Canada and Australia by reducing the effective tariff on their wheat, eventually a reduction of about $70 per metric ton, or 45 percent below the current tariff on U.S. wheat.
A bilateral trade agreement with Japan, which the Trump administration is working on, could reduce the tariff level on U.S. wheat, according to USWA.