Wheat Industry Looks for New NAFTA Opportunities, But Priority Remains Do No Harm

U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) urge caution as the Trump Administration officially submitted to Congress its notice of intent to renegotiate the North American Free Trade Agreement (NAFTA). The U.S. wheat industry welcomes the opportunity for improving the framework for cross border wheat trade between the United States, Canada, and Mexico, but would strongly oppose changes that might limit the current NAFTA’s benefits for wheat farmers and their customers, particularly in the Mexican food processing industries.

Since NAFTA entered into force on Jan. 1, 1994, trade has boomed between the United States, Canada, and Mexico. Specifically, NAFTA delivered a winning combination of free trade on a level playing field and a growing Mexican middle class with the income to demand better products, including food using imported wheat. Following years of market development work and duty free access, Mexico dramatically increased its U.S. wheat imports after NAFTA and imports in the current marketing year are up 40 percent, making Mexico our largest buyer.

“I cannot emphasize enough how important our Mexican customers are to U.S. wheat farmers,” said Jason Scott, a wheat farmer from Easton, Md., and USW Chairman. “There is nothing wrong with modernizing a 23-year-old agreement, but that must be done in a way that benefits the food and agriculture sectors in both countries.”

Negotiating a new NAFTA certainly can make improvements. A good place to start are the sanitary and phytosanitary (SPS) rules that the three countries already agreed to as part of the Trans-Pacific Partnership (TPP) negotiations.

“If the administration intends on renegotiating NAFTA, it must guarantee growers that new terms won’t reverse the significant benefits for U.S. wheat farmers, like duty free access,” said David Schemm, a wheat farmer from Sharon Springs, Kan., and NAWG President. “Despite the risks, there’s an opportunity here to get better trade rules in place that will set the gold standard for trade agreements going forward, without hurting wheat farmers and their importing customers.”