Tuesday, May 11, 2010

May is International Trade Month

From the National Cattlemen's Beef Association:

Did you know that May is International Trade Month? President Obama has set a goal of doubling exports over the next five years as a way to stimulate economic and job growth. The best way to do that is through free trade agreements (FTAs). But unfortunately, our pending FTAs with Colombia, Panama and South Korea are stalled in Congress. With other countries outpacing us in the race to ratify new trade agreements, it's more critical than ever that Congress take action. Every day that passes without progress puts American jobs and market share at further risk.

On Monday, May 3, National Cattlemen's Beef Association (NCBA) President Steve Foglesong and representatives from the National Pork Producers Council, American Farm Bureau Federation, National Association of Wheat Growers and the National Corn Growers Association held a press conference to highlight the importance of our pending FTAs. The following is an excerpt from Foglesong's remarks as prepared:

"I, as a producer, through our Beef Checkoff program have been spending my own money to keep our foot in the door in Korea and many other countries around the world, waiting and hoping to have the chance to some day actually get to sell my product, beef, to anxious consumers all around the globe. It doesn't seem like much to invest a dollar a head for every animal we market. But over the course of ten years, if you market 10,000 a year, it gets to be $100,000--and to most of us that's real money. And we as cattlemen expect a payoff for our investment, and the time for that payoff is now.

"Congress has the ability to level the playing field and open the Korean market to our products if they would just get down to business and get it done. The Australians are working diligently at passing their own free trade agreement, and if they beat us to the punch they will secure a 2.67% tariff advantage over our U.S. products for the next 15 years. Let me break this down for you. If we allow Australia to secure their own FTA before us, for the next 15 years, the average Korean housewife will go to the store and have the option to buy several products: domestically grown Korean beef, Australian beef, and U.S. beef. What's she going to buy? What would you buy? What ever was cheaper, right? Of course you would. You've got kids to feed and only so much change in your pocket. You'd really like to try the U.S. beef. You've seen the ads for years and it looks so good. But it's 3% higher and you've only got so much money. If Congress doesn't quit plodding along in the mud, this scene will get played out over and over again for the next 15 years.

"Farmers and ranchers, if they are profitable, will put most of what they make right back into the economy--always have, always will. They are not savers; they are builders. What they spend their money on is manufactured goods, tractors, pickup trucks, fence material, feed--all things that are made by people at good paying jobs that are created when there is money being made out in rural America. The cattle feeding business has been a losing proposition for the last 27 months for a lot of reasons, but our ethanol policy and the economic downturn both get a huge share of the blame. Supply and demand recently has put a glimmer of hope back in our industry and cattlemen across the country are poised to rebuild their farms and ranches with any evidence of profit showing up on the horizon. Cattlemen live by a few simple rules, and the most important is that your word is your bond; you never go back on a deal--period. Multimillion dollar deals are done every day on a handshake, or a simple, 'yea that sounds good to me,' over the phone--no contract, no legal representation, just the purest affirmation of a deal, your word. You break this rule and the word travels fast, trust is broken, nobody wants to do business with you.

"I heard what President Obama said in the State of the Union and what Ron Kirk has been talking about, and I know what I expect of the Congressmen I sent to Washington. I expect them to keep their word. The President promised to deliver healthcare with the help of Congress and I expect that same level of commitment from the President and Speaker Pelosi and Leader Reid delivering these Free Trade Agreements so America's farmers and ranchers can do their part to create jobs and jump start our economy."

For more information on beef trade, visit: http://www.beefusa.org/uDocs/tradeleavebehind.pdf

A few more trade facts from the NCBA:

The U.S. is the world's largest beef producer. With an annual processing of about 34 million head of cattle, the U.S. produces about 12 million tons of beef. Brazil is second with nine million tons, followed by Europe at eight million tons, and China at six million tons. These numbers are important to put into context when we consider that in just the next eight years, beef consumption around the world will increase by about 8.5 million tons, or about three-fourths of the entire U.S. beef herd. Beef exports over the next eight years are expected to grow by 2.8 million tons, equivalent to 20% of U.S. beef production today.

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