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FACT SHEET:
 U.S.-Colombia Trade Promotion Agreement - West Virginia Will Benefit
 September 2008
 

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The U.S.-Colombia Trade Promotion Agreement (CTPA) eliminates high tariffs and other barriers on most agricultural products, including West Virginia’s key exports. Already our largest market in South America, Colombia holds even greater potential because it has agreed to immediately eliminate duties on 53 percent of current U.S. trade. At the same time, the agreement levels the playing field so U.S. producers can better compete with producers from other countries that export to Colombia. The American Farm Bureau and 45 other agricultural industry and farm groups support the CTPA because increased export opportunities mean stronger prices for all America’s farmers and ranchers. West Virginia’s agricultural exports were estimated at $42 million in 2006, while the state’s farm cash receipts totaled $451 million.

Poultry. Poultry meat exports to Colombia surpassed $11.6 million in 2007. West Virginia broilers are the state’s leading agricultural export product with $26 million, as well as its largest provider of cash receipts with $218 million. West Virginia’s poultry producers and processors will benefit from the CTPA.
  • U.S. poultry producers currently face a system of variable levies (price band system) that result in tariffs as high as the World Trade Organization (WTO) ceiling of 209 percent. Upon implementation of the CTPA, Colombia will immediately eliminate the price band system on U.S. imports.
  • Colombia will provide immediate duty-free access on chicken leg quarters, which currently faces a 20-percent duty (209 percent allowed by the WTO), through a 27,040-ton tariff-rate quota (TRQ) that expands by 4 percent, compounded annually. Colombia will phase out the 164.4-percent over-quota tariff for fresh, chilled and frozen leg quarters and 70-percent over-quota tariff for processed leg quarters over 18 years with no reductions during the first 6 years of the agreement.
  • Colombia will also provide a 412-ton TRQ that expands 3 percent, compounded annually, for "spent fowl." Colombia will phase out the 45-percent over-quota tariff for "spent fowl" over 18 years.
  • Colombia will immediately phase out duties on poultry products such as wings and breast meat.
  • Tariffs on turkey products will be phased out over 5 years.
  • Colombia will immediately eliminate duties on live chicks and hatching eggs and will phase out duties on eggs for consumption over 10 years.
  • Colombia agreed to continue to recognize the equivalence of the U.S. meat inspection and certification system to its own system.
  • The National Chicken Council, USA Poultry and Egg Export Council, National Turkey Federation, United Egg Association, United Egg Producers, and Pet Food Institute publicly support the CTPA.

Beef. In 2007, the United States exported $386,000 of beef and beef products to Colombia. West Virginia’s ranchers and beef industry generate the second largest source of farm cash receipts in the state.
  • 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 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.

Dairy. U.S. dairy exports to Colombia surpassed $6.6 million in 2007, and changes with the CTPA will provide immediate opportunities for U.S. dairy producers. West Virginia dairy producers are the state’s fourth largest source of cash receipts. West Virginia’s dairy producers will benefit from the CTPA.
  • U.S. dairy producers currently face a system of variable levies (price band system) that results in tariffs as high as the WTO ceiling of 159 percent. Colombia will immediately eliminate the price band system on U.S. imports.
  • Colombia will immediately eliminate tariffs on whey.
  • Both Colombia and the United States will establish duty-free TRQs for certain dairy products totaling 9,900 tons, with these TRQs growing by 10 percent, compounded annually.
  • All Colombian duties on dairy products will be eliminated within 15 years, with duties on some eliminated earlier.
  • The National Milk Producers Federation, U.S. Dairy Export Council, Grocery Manufacturers Association/Food Products Association, and International Dairy Foods Association publicly support the CTPA.

Fruits. Exports of fresh fruit to Colombia surpassed a record $14.4 million in 2007.  Exports of fresh fruit to Colombia surpassed $11.4 million in 2006, nearly 250 percent that of 2002. As the state’s third largest agricultural export, West Virginia’s fruit producers and processors will benefit from the CTPA.
  • Current duties on fruit and preparations are 15–20 percent in Colombia, and under WTO rules, could rise to 140 percent.
  • Colombia will immediately eliminate duties on fresh apples and pears.
  • The Northwest Horticultural Council and the Grocery Manufacturers Association/Food Products Association publicly support the CTPA.

 

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