Nebraska grows the food that feeds the world. Generations of Nebraskans have worked to develop markets for our high-quality ag products, creating opportunities for our farm and ranch families. Our recent struggles with low commodity prices illustrate the continued importance of trade for Nebraska. To this end, I’ve been leading trade missions around the world, lobbying for the passage of new trade deals, and working to diversify our markets.
This year, three international trade missions led us to four strategic trade partners: Mexico, Vietnam, Japan, and Germany. In Vietnam, we promoted Nebraska beef and urged officials to approve American biotech applications for soybeans, corn, and alfalfa. Nebraska beef exports to Vietnam grew 127 percent last year, and we want to sell even more. Vietnam’s rapidly growing economy will aid our efforts in the years to come. Our conversations with the Prime Minister of Vietnam and his cabinet officials led to approval of five biotech traits that had been stuck in red tape. Our face-to-face conversations helped highlight the importance of these applications.
During our mission to Germany, Chapman-based Preferred Popcorn signed a deal to grow its relationship with Germany-based Haase Food. We also promoted Nebraska beef, which is set for significant growth thanks to a new deal between President Trump and the European Union (EU) to more than double American beef exports to the EU. These trade missions lay the groundwork for Nebraska’s future international growth. No company invests in a generic place called Nebraska. They choose to do business with specific leaders whom they respect and trust because they have a personal relationship with them.
While we can build the relationships, free trade agreements open the door for Nebraska’s ag products. That’s why the Trump Administration’s work to secure new trade agreements for the U.S. has been so important. Last week, Japan’s parliament approved a trade deal negotiated earlier this year by President Trump and Prime Minister Shinzō Abe. The agreement is a big win for Nebraska farmers and ranchers and for Japanese consumers. Starting on January 1, 2020 the deal reduces Japan’s tariffs on U.S. beef from 38.5 percent to 26.6 percent. Eventually, the tariff will fall to nine percent. Tariffs on pork, corn, wheat, and other Nebraska-grown crops will also significantly decrease. Breaking down these barriers will grow the longstanding friendship between our two countries and give our Japanese customers even greater access to our high-quality food.
The U.S.-Mexico-Canada Agreement (USMCA) is another trade deal that will help grow Nebraska. Sadly, Democrats in Congress have stalled USMCA and are preventing Nebraskans from enjoying its benefits. Last Wednesday, Nebraska Senator Ben Sasse delivered a compelling speech on the Senate floor, urging Democrat House Speaker Nancy Pelosi to stop blocking a vote on the deal. We will continue to work with our federal delegation to end her senseless delay of USMCA.
By actively pursuing new markets and pushing for new trade deals, we helped increase Nebraska’s total exports by $667 million (7 percent) from 2017 to 2018. Growth in ag exports represented one-third of this increase ($226 million).
These are important accomplishments at a time when our ag producers have faced significant headwinds in the Chinese market. While the media likes to put the focus on President Trump, Nebraska’s trade relationship with China has been in flux for many years. From 1996 to 2003, Chinese demand for U.S. beef grew exponentially. Then, in late 2003, China suddenly shut its market to U.S. beef after the discovery of a case of Bovine Spongiform Encephalopathy (BSE). U.S. ranchers effectively had no access to China’s beef market for over 13 years until President Trump helped reopen it in 2017. Exports of other ag products to China have also varied greatly from year to year. China’s imports of our state’s corn collapsed from $119 million in 2013 to $11 million in 2014 and have remained near 2014 levels since then. In 2014, Nebraska exported a record $284 million of hides and skins to China. Just two years later, that amount had fallen more than 40 percent. These numbers show how China has been an inconsistent trade partner.
Unpredictability in our trade relationship with the world’s largest country makes our strategic efforts to diversify our markets all the more important. In addition to the trade missions led throughout the year, we have been hosting international delegations here in Nebraska from the Philippines, Indonesia, Taiwan, Kazakhstan, and other countries. The trade delegation from Taiwan agreed to purchase $2.1 billion in new U.S. ag products. And this week, the Prime Minister of the Republic of Kazakhstan visited to formalize an agreement with Valmont to purchase Nebraska center pivots to help Kazakh farmers become more productive.
As Nebraska’s ag producers face ongoing uncertainty headed into 2020, I will continue to work to develop markets for Nebraska’s agricultural products around the world. If you want to share promising opportunities, please email me at [email protected] or call 402-471-2244. Together, let’s spread the word about what the Cornhusker State has to offer the world.