The Washington State Department of Agriculture is trying to determine the impact of the Trans-Pacific Partnership proceeding without the U.S.
“We’re still figuring out what that impact is, and how quickly those competitive disadvantages will emerge,” said Derek Sandison, WSDA director. “How much time do we have to find a solution before we actually are having real, tangible impacts — in terms of how much more tariffs we’re paying than our competitors?”
The U.S. wheat industry estimates the tariff alone will create a $200 million annual disadvantage in Japan by the time the trade deal is fully implemented in nine years.
The department is working with various commodity organizations to get a sense of what they’ve heard and know, Sandison said. The state is using its connections with USDA to assess what they’re seeing.
“Who’s impacted, by how much, and when?” Sandison said.
During a National Association of State Departments of Agriculture forum in Washington, D.C., he spoke with Ted McKinney, USDA Undersecretary for trade and foreign agricultural affairs, and Sharon Bomer Lauritsen, assistant trade representative for agricultural affairs and commodity policy for the U.S. Trade Representative.
Sandison told McKinney and Lauritsen that the agreement, called TPP 11, will create an uneven playing field for U.S. commodities.
McKinney and Lauritsen said one problem is the U.S. Senate is sitting on the confirmation of Greg Doud, who was nominated to be the chief agricultural negotiator for USTR, Sandison said. The hold was recently lifted, but no Senate vote has been set on his appointment.
“Not having that critical position in place does somewhat limit their ability to have a broad, ranging set of discussions throughout ag trade,” Sandison said. “From their standpoint, they still want to pursue bilaterals, although we’ve seen in recent news stories that the president has expressed some interest in maybe revisiting the multilateral side of this, which has yet to be seen.”
Wheat industry representatives recently met with Japanese government officials and flour millers, hearing that Japan is not interested in a bilateral agreement. Sandison said Japan expressed similar sentiments to other groups recently, including the Montana Department of Agriculture.
Japan recently entered an agreement with the European Union, which will likely affect the ability to compete selling Washington wine in Japan, Sandison said. Wine-selling competitors such as Australia and New Zealand remain in TPP, and will have a competitive advantage over the U.S. in the Japanese market, Sandison said.
Sandison will be in Washington, D.C., the week of Feb. 5 with state wheat industry representatives, meeting with the White House’s agriculture and trade representative to explain the potential impacts of the U.S. leaving TPP.
State agriculture representatives met last week with Senate Finance Committee staff to voice their concerns.
“People are hearing this, they understand it,” Sandison said. “We will continue to advance the concerns and help look for constructive ways we can level that playing field.”
Sandison hopes for more favorable trade terms, but says those are not likely in the near future.
The next round of North American Free Trade Agreement negotiations are slated for March. They’re possibly the last good opportunity for an agreement before mid-term elections and the next presidential election, Sandison said.
On the Asian-Pacific front and TPP, “we’ve got a ways to go,” he said.
Serious negotiations don’t appear to have begun, he said.
“There’s discussions going on, but right now, when you have Japan saying, ‘We’re not even interested in considering bilateral (agreements), that makes for a difficult conversation,” he said.