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FACT
SHEET:
U.S.-Colombia Trade
Promotion Agreement -
North Dakota Farmers Will Benefit
September 2008
![](https://webarchive.library.unt.edu/eot2008/20080920191122im_/http://www.fas.usda.gov/info/factsheets/images/spacer.gif)
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The U.S.-Colombia Trade Promotion Agreement (CTPA) provides increased access for
North Dakota’s agricultural exports by making agricultural trade a two-way
street and leveling the playing field with respect to third country competitors
in the Colombian market. Already our largest market in South America, Colombia
now holds even greater potential because it has agreed to immediately eliminate
duties on 53 percent of current U.S. trade upon implementation of the agreement.
The American Farm Bureau and over 40 other agricultural industry and farm groups
strongly support the agreement by stating "the agreement will provide U.S.
products exported to Colombia with the same duty-free access already granted to
Colombian products exported to the U.S."
Exports of farm products boost North Dakota’s farm prices and income. Such
exports support about 22,300 jobs both on and off the farm in food processing,
storage, and transportation. Agricultural exports amounted to $1.9 billion and
made an important contribution to North Dakota's farm cash receipts in 2006 that
totaled $4 billion.
Wheat and Barley.
In 2007, the United States exported $210 million of wheat and barley to
Colombia. The nation’s top wheat exporter—with wheat
and barley ranked first and tenth among state farm cash receipts—North Dakota
wheat and barley producers will benefit from the CTPA.
- U.S. wheat and barely producers currently face a system of variable
levies (price band system) that results in tariffs as high as the World
Trade Organization (WTO) ceiling of 248 percent. Colombia will immediately
eliminate the price band system on U.S. imports.
- Colombia will immediately eliminate all tariffs on wheat and wheat
products, which currently face duties ranging from 5–20 percent.
- Colombia will immediately eliminate all tariffs on barley and barley
products, except feed barley. Tariffs on feed barley will be eliminated in
2009.
- The National Association of Wheat Growers, the National Grain and Feed
Association, the North American Export Grain Association, the North American
Millers’ Association, the National Barley Growers Association, U.S. Wheat
Associates, and the American Bakers Association publicly support the CTPA.
Beef.
In 2007, the United States exported $386,000 of beef and beef products
to Colombia.
North Dakota’s ranchers and beef industry generate farm cash
receipts of about $726 million.
- Colombia will immediately eliminate its 80-percent duty (108 percent
allowed by the WTO) on beef products of most importance to the U.S. beef
industry—prime and choice cuts.
- U.S. exporters of standard quality beef cuts will enjoy immediate
duty-free access through a 2,100-ton tariff rate quota (TRQ). The TRQ will
grow by 5 percent, compounded annually. Colombia will phase out the
80-percent out-of-quota tariff over 10 years after a 37.5-percent cut at the
beginning of the first year of implementation.
- U.S. exporters of variety meats (offals) will immediately receive
duty-free access under a 4,642-ton TRQ that will grow 5.5 percent,
compounded annually. The 80-percent over-quota tariff will be phased out
over 10 years.
- Colombia agreed to continue to recognize the equivalence of the U.S.
meat inspection and certification system to its own system.
- Colombian exporters of beef to the United States will receive duty-free
access under a 5,250-ton TRQ that will grow 5 percent, compounded annually.
The United States will phase out its beef tariffs over 10 years. For those
beef lines that are already duty free under the Andean Trade Promotion and
Drug Eradication Act, the CTPA will continue the duty-free treatment.
- The American Meat Institute; National Cattlemen’s Beef Association; U.S.
Hide, Skin and Leather Association; U.S. Livestock Genetics Export, Inc.;
and Pet Food Institute publicly support the CTPA.
Soybeans and Products. In 2007, the United States
exported $175 million of soybeans and soybean products to Colombia. Suppliers of the state’s
second largest
agricultural export and third largest source of cash receipts, North Dakota
soybean producers will benefit from the CTPA.
- U.S. soybean producers currently face a system of variable levies (price
band system) that results in tariffs as high as the WTO ceiling of 150
percent. Colombia will immediately eliminate the price band system on U.S.
imports.
- Colombia will immediately eliminate duties, currently ranging from 5–20
percent on soybeans, soybean meal and soybean flour.
- Colombia will eliminate duties within 5 years on crude soybean oil
(currently 20 percent; 75 percent allowed by the WTO).
- Colombia will provide duty-free access for crude soybean oil by
establishing a 31,200-ton duty-free TRQ that will grow 4 percent, compounded
annually. Colombia will phase out the 24-percent over-quota tariff over 10
years.
- The American Soybean Association, the National Oilseed Processors
Association, the American Feed Industry Association, and the Pet Food
Institute publicly support the CTPA.
Corn.
In 2007, the United States exported $500 million of
yellow corn and $16 million of white corn to Colombia. Providing the
fourth largest source of farm cash receipts, North Dakota’s corn producers will
benefit from the CTPA.
- Colombia will immediately eliminate its system of variable levies (price
band system) facing U.S. exporters. Under the system, tariffs can be as high
as the WTO ceiling of 195 percent on some corn products.
- Colombia will provide immediate duty-free access for yellow corn by
establishing a 2.1-million-ton TRQ that grows 5 percent, compounded
annually. Colombia will phase out the over-quota tariff over 12 years.
- Colombia will provide immediate duty-free access for white corn by
establishing a 136,500-ton TRQ that grows 5 percent, compounded annually.
Colombia will phase out the over-quota tariff over 12 years.
- Colombia will provide immediate duty-free access for animal feeds by
establishing a 194,250-ton TRQ that grows 5 percent, compounded annually.
Colombia will phase out the over-quota tariff over 12 years.
- All currently applied duties on all other corn products will be phased
out within 10 years.
- The Corn Refiners Association, the National Corn Growers Association,
the National Grain and Feed Association, the North American Export Grain
Association, the North American Millers’ Association, the American Feed
Industry Association, and the Pet Food Institute publicly support the CTPA.
Sugar. In 2007, the United States exported $9.4
million of sugar and sweeteners to Colombia. There will be no reductions in the U.S. over-quota duty that
currently provides the equivalent of a 100-percent tariff protection for
domestic producers including the 4 percent of North Dakota farms engaged in
sugar production.
- U.S. sugar producers currently face a system of variable levies (price
band system) in Colombia that results in tariffs as high as the WTO ceiling
of 130 percent. Colombia will immediately eliminate the price band system on
U.S. imports.
- Colombia will provide immediate duty-free access for glucose, which
currently faces a 20-percent duty (28 percent allowed by the WTO), through a
10,500-ton TRQ that expands 5 percent annually. Colombia will phase out the
28-percent over-quota tariff over 10 years.
- Colombia will eliminate duties within 15 years for all other sugar and
sweeteners. In a few cases, duties will be eliminated sooner (such as high
fructose corn syrup in 9 years).
- The United States will establish a 50,000-ton TRQ for Colombia for sugar
products covered by the WTO TRQ. This amount grows by 1.5 percent a year
into perpetuity.
- Provisions will ensure that Colombia will only ship when it is a net
surplus exporter, and provisions have been agreed to allow alternative forms
of compensation to be established to facilitate sugar stock management by
the United States.
- The Sweetener Users Association and Grocery Manufacturers
Association/Food Products Association publicly support the CTPA.
Back to the
U.S.–Colombia Trade
Promotion Agreement
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