USGC Comments on Grain Trade Barriers

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The U.S. Grains Council (USGC) recently submitted comments to the Office of the U.S. Trade Representative (USTR) highlighting significant trade barriers facing exports of U.S. coarse grains, ethanol and co-products. The Council has contributed comments on this topic to USTR for more than a decade, detailing constraints the organization works to address in its export market development activities and recommending complimentary U.S. government action.

“We believe that resolution of the broad range of trade barriers outlined in this report could bring about a correction in the coarse grain trade trends of the last decade, restore market access and allow U.S. producers and agribusinesses to effectively explore and capture new markets and business opportunities,” the Council wrote in the submitted comments. “The Council has worked cooperatively with USTR on a number of these issues. We look forward to continued collaboration.”

A report on trade barriers facing U.S. goods and services has been issued by USTR for at least the last 35 years, in part to fulfill a legal requirement of the president of the United States to report to the U.S. Congress on that topic annually. Contributions from organizations like the Council help USTR provide quantifiable impacts of trade barriers on U.S. exports and detail feasible actions that can be taken to eliminate those barriers.

“It is important to understand the specific complexities of each trade barrier in each market,” said Floyd Gaibler, USGC director of trade policy and biotechnology. “USTR and U.S. Department of Agriculture (USDA) officials use this information in their continuous, cooperative work with our overseas offices to increase market access for U.S. agricultural products.”

Among the highest priority items for the Council are persistent non-tariff issues like biotech approval policies. Delays in biotech approvals in Mexico, asynchronous biotech approvals in Brazil and worldwide irregularity on the regulation of plant breeding innovations (PBI) all inhibit U.S. agricultural products from entering these large markets.

Unjustified restrictions on genetically modified products have seen dramatic impacts on U.S. corn sales to the European Union (EU). The United States was once the largest foreign supplier of corn to the EU, but there have been no substantial exports to the EU since the late 1990s when these policies were put into place. USGC analysis estimates these asynchronous biotech regulatory processes have contributed to a 100-million-metric-ton loss in U.S. corn exports, a value exceeding $15 billion.

An increasing area of concern is related to regulatory restrictions on crop protection products, including maximum residue levels (MRLs) set lower than internationally recognized standards in the EU.

In addition to these non-tariff barriers to trade, countervailing duties and value-added taxes put U.S. agricultural products at a financial disadvantage. Similarly, import tariffs and tariff rate quotas also directly affect the price of U.S. coarse grains and co-products, removing competitive advantages on price.

Together, these comments help provide input not only for USTR, but also for the Council’s Trade Policy Advisory Team (A-team) and for country and regional offices developing trade policy strategies for the Council’s operational blueprint, the Unified Export Strategy (UES). These comments also contribute to the Council’s participation in the USDA’s Grains and Oilseeds Agricultural Technical Advisory Committee (ATAC).

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U.S. Grains Council


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