SPOKANE, Wash. – Washington State wheat growers say the Trans-Pacific Partnership trade agreement would result in the loss of hundreds of millions of dollars every year for farmers.
Washington Grain Commission leaders said they expect that the agreement would result in the nation’s wheat farmers losing $500 million. The total loss would add up to $3 billion over the next 10 years.
U.S. Wheat Associates estimates Japanese imports of U.S. wheat would fall by 62.5 million bushels annually. They believe this would result in increased stocks and lowering baseline wheat futures price by 50 cents a bushel. Glen Squires, CEO of the Washington Grain Commission, said this is a looming disaster for farmers in the Pacific Northwest and beyond.
“Every $1 billion decline in farm exports results in the loss of 8,000 jobs. Here in Eastern Washington, that would impact port facilities, barge companies, railroads, export elevators, longshoreman and ship handlers,” Squires said.
USW estimates that 19,000 fewer rail cars would move wheat to export because of the deal and export elevators and ship handlers would lose volume equal to nearly 70 bulk vessel loads.
Washington Grain Commission officials said Japan is the largest and most valuable market for U.S. wheat in the world. They said they buy more U.S. grain than any other customer. In fact, the country has bought more grain than any other customer since 1949.
Squires said the TPP deal would gradually discount the tariff rate paid for imported Australian and Canadian wheat into Japan from about $150 a metric ton to $85 per metric ton, and would leave the U.S. import tariff unchanged.
“The Japanese love the quality and consistency of Pacific Northwest wheat and continue to buy our wheat despite its marginally higher price on the world market. But a $65 a ton disadvantage is just too much to overcome and would force them into the arms of our competitors,” Squires said.
He said the TPP was originally envisioned as a trading block of 12 countries around the Pacific Rim that would lead to positive economic outcomes for everyone involved. It would also reduce the dependence of member countries on China.
Squires said President Donald Trump withdrew the U.S. from the pact in January 2017. The 11 remaining countries negotiated their own deal and it is expected to be signed in March.
Japan, Australia, Canada, Brunei, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam are all members of the TPP 11.