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The U.S.-Panama Trade Promotion Agreement eliminates tariffs and other
barriers on most U.S. goods, increasing export opportunities for agricultural
products important to Delaware. With immediate elimination of duties on over 60
percent of current U.S. trade, this agreement changes the one-way street of
duty-free access currently enjoyed by most Panamanian exports into a two-way
street benefiting both countries. The American Farm Bureau strongly supports the
agreement, predicting widespread gains for U.S. agriculture exceeding $190
million per year.
Delaware’s exports to all countries, estimated at $145 million in 2006,
supported about 1,800 jobs, on and off the farm. These export sales make an
important contribution to the Delaware farm economy which had total cash
receipts of $955 million in 2006.
Poultry Meat. The broiler industry accounts for nearly 80 percent of
Delaware’s total farm cash receipts with sales of $844 million 2005. From 2004
through 2006, U.S. suppliers shipped an average 5,700 tons of poultry meat
valued at $7 million to Panama each year. However, exports are mostly limited to
turkey cuts and whole turkeys due to a 260-percent tariff on broiler leg
quarters. Delaware poultry producers and processors will benefit from this
agreement.
The 260-percent tariff currently applied to chicken cuts will be
eliminated immediately for mechanically de-boned chicken, within 5 years for
wings and 10 years for other chicken cuts except leg quarters.
Panama will provide immediate duty-free access within a preferential
tariff-rate quota (TRQ) for chicken leg quarters that starts at 660 tons and
grows each year by 10 percent. The 260-percent over-quota tariff will be
eliminated in 18 years.
U.S. poultry exporters will continue to have access to the global
756-ton TRQ for chicken cuts that is part of Panama’s World Trade
Organization commitments.
Panama will eliminate its 15-percent duties on turkey meat immediately
for frozen whole turkeys and most frozen turkey cuts. The 15-percent tariffs
on processed turkey and chicken will be eliminated within 5 years.
In addition, Panama has already implemented our December 2006 bilateral
agreement on sanitary and phytosanitary measures by recognizing the
equivalence of the U.S. poultry inspection and disease monitoring systems,
allowing U.S. inspectors to certify poultry for export to Panama without
having each facility and shipment inspected by Panamanian authorities.
Feed Grains. Corn is Delaware’s second largest source of cash receipts
with sales of $36 million in 2005. Corn growers will benefit from the agreement.
Panama will provide immediate duty-free access within a TRQ for 298,700
tons of U.S. corn that will grow at a rate of 3 percent each year. The
40-percent over-quota tariff will be eliminated in 15 years.
The current zero-tariff treatment for crude corn oil will be locked in
place immediately and Panama will provide immediate duty-free access for
refined corn oil within a 368-ton TRQ that grows each year by 5 percent. The
30-percent over-quota tariff will be phased out within 10 years.
Soybeans and Products. Panama is the twelfth largest export market for
U.S. soybean meal with exports for the most recent three years averaging 109,000
tons valued at $24.7 million. With farm cash receipts of $28 million in 2005,
Delaware’s soybean producers will benefit from this agreement.
Panama’s current zero-tariff treatment for soybeans and soybean meal
will be locked in place immediately upon implementation of the Agreement.
The current zero-tariff treatment for crude soybean oil will also be
locked in place immediately, while the 20-percent tariff on refined soybean
oil will be phased out in 15 years.
Back to the
U.S.–Panama Trade
Promotion Agreement
