04/13/05 Wheat and CAFTA

04/13/05 Wheat and CAFTA

Farm and Ranch April 13, 2005 Hearings begin in Congress today on the Central American-Dominican Republic Free Trade Agreement. The trade agreement is expected to face a tough fight in congress. How does the U.S. wheat industry stand? Spangler: "The wheat industry is very, very supportive of this agreement. It is one that is a win-win for the wheat industry." That is Barbara Spangler of the Wheat Export Trade Education Committee. She says that although the U.S. already has over a 70 percent share of the Central American wheat market, the U.S. needs all the markets it can get and to keep this one, particularly with Argentina working hard in the region and the European Union wanting to get back in. . Spangler: "And I would expect that if we didn't pass this agreement, they wouldn't look very favorable on the U.S. as a trading partner. So, we are looking at this as a very simple way to lock in a market in our own neighborhood that is currently a very good market and to protect that market." Costa Rica is the only country in the agreement that currently imposes a tariff on U.S. wheat imports, a one percent tariff, but Spangler says under WTO rules triple digit tariffs could be imposed. Under CAFTA the tariffs on U.S. wheat go to zero and tariffs on flour are phased out over a 12 to 15 year period. While nationally the wheat industry supports CAFTA not all state groups do. In Idaho, where wheat growers may also grow sugar beets, the Idaho Grain Producers Association opposes the agreement. I'm Bob Hoff and that's the Northwest Farm and Ranch Report on the Northwest Ag Information Network.
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