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AG Sector Applauds FTA

on March 18 | in Ag News | by | with No Comments

From FCC Express, by Allison Finnamore

Many of Canada’s agricultural sectors are applauding the free trade agreement announced earlier this week between Canada and Korea.

The agreement, they say, puts Canadian agricultural goods on a level playing field with products from competitors like the United States, European Union, Australia and Chile, which have already signed trade agreements with Korea.

The Canadian Pork Council says the pork industry has seen a decline in exports over the last few years. Pork exports rang in at $223 million in 2011; $129 million in 2012 and $76 million in 2013. Without the agreement, CPC says the Korean export market was destined to disappear, especially due to trade agreements with other countries.

The Canadian Cattlemen’s Association says it’s also very pleased with the announcement.

CCA president Dave Solverson says the 40 per cent tariff on fresh and frozen beef has been the main impediment to accessing the Korean market since Korea lifted its BSE prohibition on Canada in early 2012. Under the agreement, that tariff will be fully eliminated in 15 equal annual steps. The 18 per cent tariff on offals will also be fully eliminated in 11 equal annual steps.

The Saskatchewan Stock Growers Association points out that tariffs on fats and tallows will be fully eliminated as soon as the agreement comes into effect.

The new market for what is typically considered waste in North America is a definite advantage, says SSGA president Harold Martens.

“Having the ability to get every piece of the animal to its highest value market will help maximize prices at the farm gate here in Saskatchewan,” Martens states

Wade Sobkowic, executive director of the Western Grain Elevator Association, says like beef and pork producers, grain farmers will be looking at rebuilding markets lost to other countries.

“In 2012, Canadian grain exports to Korea were $479 million a year,” Sobkowic says. “Today, they are less than $100 million. Now, with the FTA announcement, we can look at rebuilding our presence in the Korean market.”

Jim Everson, vice-president of government relations with the Canola Council of Canada says stable and open trade is a priority of the Canadian canola industry. Over 90 per cent of Canada’s canola production is exported.

The Malting Industry Association of Canada says tariffs will be eliminated on 13,000 tonnes of malt upon ratification of the agreement, with tariff-free access reaching 25,000 tonnes by year 11 and complete tariff free access in year 12. Korea is Canada’s third largest offshore malt export market with annual sales today of approximately 25,000 tonnes.

“This agreement will now provide Canadian maltsters not only competitive export stability in this market, but opens the door for what we believe will be increased sales moving forward,” says Phil de Kemp, MIAC president.

He predicts additional domestic sales opportunities for malting barley producers due to the anticipated increased market opportunities for value-added malt during the course of the implementation period and certainly beyond.

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