United States and Chile Agree to Negotiate a Bilateral
Free Trade Agreement
On November 29, 2000, President Clinton announced that
the United States and Chile had agreed to negotiate a
bilateral free trade agreement (FTA). In the
negotiations, the United States and the Republic of Chile
will seek to eliminate duties and commercial barriers to
bilateral trade in U.S.- and Chilean-origin goods and
also address trade in services, agricultural products,
investment, trade-related aspects of intellectual
property rights, trade-related environmental and labor
matters, and other issues. Regarding agriculture, it is
anticipated that the FTA will improve U.S. agricultural
market access to Chile. Currently, Chile enjoys a
favorable agricultural trade balance with the U.S., with
a surplus of almost $1 billion annually. In the last five
years, Chile’s access to the U.S. agricultural
markets has been virtually free with annual exports
around $1.4 billion, while U.S. exports to Chile range
between $120 - $178 million annually.
ITC to Investigate the Impact of European Union
Policies on the Global Competitiveness of U.S.
Horticultural Products
In a December 13 press release, the U.S. International
Trade Commission (ITC) announced that it had launched a
general fact-finding investigation on the effects of
European Union (EU) policies on the competitive position
of the U.S. and the EU horticultural products sectors.
The investigation, The Effects of EU Policies on the
Competitive Position of the U.S. and EU Horticultural
Products Sectors (Inv. No. 332-423), was requested by
the U.S. Trade Representative in a letter received
November 16, 2000. As requested, the ITC's report will
provide information on EU policies and programs that may
enhance the competitiveness of EU producers and
exporters, including domestic support commitments and
export subsidies the EU reports to the WTO, the EU entry
price system, the producer organization system, and EU
tariffs. The investigation will describe policies and
programs and will analyze the extent to which such
programs affect the competitive conditions between EU
producers and exporters and U.S. producers. As requested,
the ITC's investigation will focus on the following
specific horticultural products: citrus (including fresh
oranges, fresh clementines, fresh lemons, and orange
juice), deciduous fruit (including fresh apples, fresh
pears, fresh peaches, and processed peaches), dried
prunes, tree nuts (including almonds, walnuts, and
hazelnuts), tomatoes (including fresh tomatoes and
processed tomatoes), and wine. The ITC will submit its
report to the USTR by December 1, 2001. A portion of the
report will be confidential.
To assist in identifying issues affecting the sectors
under investigation, the Commission requested that
interested parties provide preliminary written comments
by 5 p.m. on March 1, 2001. Preliminary written comments
should be addressed to the Secretary, U.S. International
Trade Commission, 500 E Street SW, Washington, DC 20436.
The ITC will hold a public hearing in connection with
this investigation on April 26, 2001, at 9:30 a.m. at the
ITC Building, 500 E Street SW, Washington, DC. Requests
to appear at the public hearing should be filed no later
than 5:15 p.m. on April 12, 2001, with the Secretary,
U.S. International Trade Commission, 500 E Street SW,
Washington, DC 20436. The ITC also welcomes written
submissions for the record in this investigation. Written
statements (one original and 14 copies) should be
submitted at the earliest practical date but no later
than 5:15 p.m. on June 11, 2001. All written submissions,
except for confidential business information, will be
available for public inspection. Written submissions
should be addressed to the Secretary, United States
International Trade Commission, 500 E Street SW,
Washington, DC 20436. Further information on the scope of
this investigation and appropriate submissions is
available in the ITC's notice of investigation, dated
December 12, 2000, which may be obtained from the ITC
Internet site (www.usitc.gov)
or by contacting the Office of the Secretary at the above
address or at 202-205-1806.
ITC to Study Tariff and Non-Tariff Barriers for Major
Products
In response to a letter received on October 31, 2000,
from the Committee on Ways and Means, U.S. House of
Representatives, the International Trade Commission (ITC)
instituted an investigation for the purpose of preparing
a report that will describe the trade barriers affecting
major products in the processed food and beverage sectors
in major and potential markets and analyze the impact of
these barriers on trade. The report will cover the
following processed products: dairy products; sugars and
sugar-containing products; vegetable oils; meats; eggs
and egg products; flours and other intermediate goods;
grain-based foods; fruits and vegetables; edible nuts and
nut products; alcoholic beverages; pet food; and other
miscellaneous food and beverage products. In order to
assist the ITC in identifying the barriers and/or issues
affecting the above sectors, the ITC requests that
interested parties provide preliminary written comments
on such barriers and/or issues by February 16, 2001. All
preliminary written comments should be addressed to the
Secretary, United States International Trade Commission,
500 E Street, SW, Washington, DC, 20436.
USDA Announces Special Apple Loan Program
Agriculture Secretary Dan Glickman announced on December
7, 2000 that USDA will make low
interest loans available to apple farmers who are
suffering hardships due to low prices for their fruit. To
qualify for the Special Apple Loan Program, applicants
must have produced apples for market in either 1999 or
2000 on a minimum of 10 acres. Eligible applicants may
obtain loans up to $300 per acre of apple trees in
production in 1999 or 2000, for a maximum of $500,000.
Interested farmers should contact their local USDA Farm
Service Agency offices or USDA Service Centers for more
information. The regulations for this program appeared in
the Federal Register on December 6, 2000. The state of
Washington produces about half of the nation’s
apples. Other high apple production states include New
York, Michigan, and California.
China Trade Mission Being Formed for Spring 2001
The Foreign Agriculture Service (FAS) is tentatively
planning a trade mission to China for early April 2001.
The focus of the trip will be on high value products,
such as those in the horticultural sector. It is
anticipated that stops will include Beijing, Shanghai,
Guangzhou and Taipei, with each stop providing
opportunities for one-to-one meetings with interested
Chinese importers. The Mission will be funded under
Section 108 and Emerging Markets authority, much the same
as the recently successful Latin America Trade Mission.
Individual participants will be asked to provide some
funds to offset the administrative costs of the Mission.
Those interested in participating or receiving more
information should contact Scott Bleggi at (202) 720-7931
or at bleggi@fas.usda.gov
Preference will be given to individual company
participants, but members of trade associations, state
regional trade groups and other trade groups are
encouraged to express interest as well.
Vegetable Prices in Canada Soar due to California Cold
Snap
Due to a short growing season, Canadians rely heavily on
imported U.S. produce during the winter, but a recent
cold snap in California has resulted in sharp wholesale
and retail price increases for lettuce, cauliflower and
broccoli across Canada. Newspapers in Ottawa and Toronto
are reporting prices for these products are more than
double their average for this time of year. These high
prices may affect U.S. vegetable exports to Canada.
Typically, Canadian retail grocery customers reduce their
purchases of temporarily high-priced produce, but begin
to buy again when supplies increase and prices ease.
California normally accounts for more than 80 percent of
total U.S. lettuce exports to Canada and 87 percent of
U.S. cauliflower and broccoli shipments to Canada.
U.S. Horticultural Exports Projected at $10.9 Billionfor FY 2001
U.S. horticultural exports for FY 2001 have been revised
from the initial forecast of $10.7 billion to $10.9
billion. This represents a 3.4-percent increase over FY
2000, as well as a second year of solid sales growth
since the 1998-99 slump. This outlook is based primarily
on continued strong sales to Canada and Mexico. Exports
to China and some other Asian countries are also expected
to achieve solid gains. Fresh and processed fruits should
drive most of the gain in FY 2001, with exports forecast
to rise $200 million to $3.6 billion. A more normal
citrus crop and stable prices are expected with the
opening of China’s market, resulting in new citrus
sales. Apple exports should also rise, supported by
greater exportable supplies. Vegetable sales should
remain strong but no increase is expected. Tree nut
exports are expected to remain at the $1 billion level.
The value of horticultural imports is projected up $200
million from August and $600 million from FY 2000. The
3.6-percent rise in horticultural imports will be driven
by continued healthy growth in U.S. consumer spending.
High-value imports, such as wine and malt beverages,
vegetables, nuts, and fruits, will continue to increase
with the help of a strong dollar.
Pecan Promotion in Japan a Success
Market Access Program (MAP) generic funding through the
Southern U.S. Trade Association (SUSTA) has helped U.S.
pecan producers to increase their share of the Japanese
market. Since 1998, the U.S. export market share of
pecans to Japan has increased from 53 to 83 percent.
SUSTA, in association with the Japan School of Baking,
targeted the Japanese baking and confectionery industry
by developing pecan recipes appealing to local consumers.
Promotional efforts also included translating U.S. Pecan
Sheller’s Association marketing materials into
Japanese. The Georgia Department of Agriculture, with
SUSTA funding, participated in the 1999 International
Food Ingredients and Additives Show in Tokyo. In
September, representatives from Japan’s two largest
food industry publications toured pecan and related
operations in Georgia and Texas, the leading U.S. pecan
producers. Key food service chains (e.g., Starbucks,
Cinnabon) have recently placed pecan products on Japanese
menus.
New National Organic Food Standards Announced
On December 20, 2000 Agriculture Secretary Dan Glickman
announced the final national standards for the
production, handling, and processing of organically grown
agricultural products. The new organic food standards
require that foods marked with the new "USDA
Organic" seal cannot be genetically engineered,
irradiated, or fertilized with sewage sludge. The
standards create clear guidelines for farmers wishing to
take advantage of the exploding demand for organic
products. Organic growers in California, which led the
push for the new standards, say new federal standards
could legitimize organic farming and be a boon to the
industry. The organic program manager for California's
Department of Agriculture said the standards will mean
"an additional standard of integrity in the
marketplace, and the ability to move product from state
to state and country to country."
USDA Proposes Reparations for Citrus Canker
Eradication
The Animal and Plant Health Inspection Service (APHIS)
proposed to establish provisions under which eligible
owners of commercial citrus groves would receive payments
to recover production income as a result of the removal
of commercial citrus trees to control citrus canker. USDA
fiscal year 2001 appropriations included funding for
these provisions. "This proposal would help to
reduce the economic effects of the citrus canker
quarantine on commercial citrus growers," said
Michael V. Dunn, then USDA’s Under Secretary for
Marketing and Regulatory Programs. The amount paid per
acre for destroyed commercial groves will vary depending
on the type of citrus trees within each grove. Citrus
canker is a plant disease that can cause defoliation and
other serious damage to the leaves and twigs of
susceptible plants. The disease also creates lesions on
inflected fruit and causes fruit to drop from trees
before reaching maturity.
USDA Targets Fruits and Vegetables for $200 Million
Relief Purchase
In accordance with The Agricultural Risk Protection Act
of 2000, the USDA’s Agricultural Marketing Service
(AMS) announced on December 7 the target list of fruits
and vegetables it will purchase. AMS will purchase large
quantities of apples, black-eyed peas, cherries, citrus,
cranberries, onions, melons, peaches, potatoes, figs,
plums, dried plums, apricots, pears, beans, corn,
tomatoes, sweet potatoes, certain mixed vegetables, and
certain tree nuts. These purchases are in addition to the
USDA’s normal purchase of fruits and vegetables. The
purchases are aided to relieve the strain on farmers
caused by record yields and low prices resulting from
favorable weather and agricultural innovation.
