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FACT SHEET:
 U.S.-Colombia Trade Promotion Agreement - Mississippi Farmers 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 Mississippi’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. Mississippi’s agricultural exports, estimated at $1.1 billion in 2007, support about 11,722 jobs on and off the farm. These exports account for almost 25 percent of Mississippi’s farm economy, with total farm cash receipts of $4.3 billion.

Poultry. Poultry meat exports to Colombia surpassed $11.6 million in 2007. Mississippi is the nation’s fifth largest poultry exporter and broilers are the state’s leading source of cash receipts with $1.9 billion. Mississippi’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.

Rice. In 2007, the United States exported $1.1 million of rice to Colombia.  As the nation’s fourth largest exporter of rice and with farm cash receipts of $138 million, Mississippi’s rice producers will benefit from the CTPA.

  • U.S. rice exporters currently face a system of variable levies (price band system) that results in tariffs as high as the WTO ceiling of 189 percent. Other rice products face applied tariff rates, ranging from 5–80 percent. Colombia will immediately eliminate the price band system on U.S. imports.
  • Colombia will establish a 79,000-ton, zero-duty rice TRQ that will grow 4.5 percent, compounded annually. All rice types will be eligible for the TRQ with the quantity on a milled-equivalent basis. The over-quota tariff will be phased out over 19 years with no reduction during the first 6 years of the agreement. Tariffs on rice flour, bran, sharps and other milled rice residues will be phased out over 5 years.
  • The USA Rice Federation publicly supports the CTPA.

Cotton. In 2007, the United States exported $59 million of cotton to Colombia.  Cotton export figures to Colombia are their highest since at least 1970 (in excess of $70 million), and growing. Mississippi is the nation’s fifth largest cotton exporter and cotton farmers generate cash receipts $453 million.
  • Under the CTPA, Colombia will immediately eliminate the 10-percent tariff (99 percent allowed by the WTO) facing U.S. exporters.
  • The CTPA provides for reciprocal elimination of all cotton duties.
  • The National Cotton Council and the American Cotton Shippers Association publicly support the CTPA.

Soybeans and Products. In 2007, the United States exported $175 million of soybeans and soybean products to Colombia.  As the state’s third largest export commodity, providing about $345 million in cash receipts, Mississippi soybeans will benefit from the CTPA.
  • U.S. soybean producers currently face a system of variable levies (price band system) that results in tariffs as high as the WTO ceiling of 150 percent. Colombia will immediately eliminate the price band system on U.S. imports.
  • Colombia will immediately eliminate duties, currently ranging from 5–20 percent on soybeans, soybean meal and soybean flour.
  • Colombia will eliminate duties within 5 years on crude soybean oil (currently 20 percent; 75 percent allowed by the WTO).
  • Colombia will provide duty-free access for crude soybean oil by establishing a 31,200-ton duty-free TRQ that will grow 4 percent, compounded annually. Colombia will phase out the 24-percent over-quota tariff over 10 years.
  • The American Soybean Association, the National Oilseed Processors Association, the American Feed Industry Association, and the Pet Food Institute publicly support the CTPA.

Beef. In 2007, the United States exported $386,000 of beef and beef products to Colombia.  Mississippi’s ranchers and beef industry generate $194 million in cash receipts.
  • 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.

Corn. In 2007, the United States exported $500 million of yellow corn and $16 million of white corn to Colombia.  As the state’s fourth largest source of farm cash receipts with $338 million, Mississippi’s corn and feed grains producers will benefit from the CTPA.
  • Under the CTPA, Colombia will immediately eliminate its system of variable levies (price band system) facing U.S. exporters. Under the system, tariffs can be as high as the WTO ceiling of 195 percent on some corn products.
  • Colombia will provide immediate duty-free access for yellow corn by establishing a 2.1-million-ton TRQ that grows 5 percent, compounded annually. Colombia will phase out the over-quota tariff over 12 years.
  • Colombia will provide immediate duty-free access for white corn by establishing a 136,500-ton TRQ that grows 5 percent, compounded annually. Colombia will phase out the over-quota tariff over 12 years.
  • Colombia will provide immediate duty-free access for animal feeds by establishing a 194,250-ton TRQ that grows 5 percent, compounded annually. Colombia will phase out the over-quota tariff over 12 years.
  • All currently applied duties on all other corn products will be phased out within 10 years.
  • The Corn Refiners Association, the National Corn Growers Association, the National Grain and Feed Association, the North American Export Grain Association, the North American Millers’ Association, the American Feed Industry Association, and the Pet Food Institute publicly support the CTPA.

Back to the U.S.–Colombia Trade Promotion Agreement