Agricultural Businesses Disagree About Value of Tariffs to Gain Reciprocity

The USTR said it particularly wanted submissions on Canada, China, Mexico, the EU, India, Argentina, Australia, Brazil, Indonesia, Japan, Korea, Malaysia, Russia, Saudi Arabia, South Africa, Switzerland, Taiwan, Thailand, Turkey, the U.K. and Vietnam, because those countries cover 88% of goods trade.

But many groups didn't provide a dollar estimate of the cost of the trade barriers, as the USTR asked for. Most explicitly said they don't want the government to impose tariffs on other countries -- whether on their specific products, or generally -- in order to open these markets. The Southern Shrimp Alliance, however, called for reciprocal tariffs on the large exporters in its sector, ranging from 13% to 45%, depending on those countries' own shrimp tariffs and value-added taxes.

Many individual shrimpers and state fisheries groups also commented.

The Southern Shrimp Alliance submission described multiple rounds of antidumping duty and countervailing duty cases -- and circumvention cases -- it has won since 2005, but said, "our conventional trade remedy laws do not provide the American shrimp industry with any way to obtain redress against these types of unfair trade practices."

"The constant threat of harm from imported shrimp is the product of deliberate decisions made by the federal government to expose our industry to unregulated import competition while the governments of our competitors provided their shrimp industries with protection from import competition," the shrimpers wrote.

In recent years, it identified $253 million worth of harm from subsidized or dumped shrimp -- that represents the decline in revenue for domestic shrimpers from 2021 to 2023. They noted that volume only dropped by 7%, but value fell 49% in that two-year period.

In addition to shrimping, there were dozens of submissions, representing row crops, fruits, vegetables, dairy, nuts, meat and prepared foods.

The Florida Fruit & Vegetable Association did not explicitly say they wanted tariffs on Mexican goods that would add up to $600 million to $1.2 billion annually, which is what they estimated that unfair competition with Mexican tomatoes, peppers, cucumbers, berries and other seasonal products cost Florida growers in sales.

However, they said the Mexican government has paid for hundreds of millions for its farms and related businesses to build "greenhouses, shade houses, macro tunnels, irrigation systems, land drainage, packing houses, refrigerated transport ... ."

The association said Florida's market share in these fruits and vegetables fell 40% from 2003 to 2023 while Mexico's more than tripled.

The California Fresh Fruit Association wrote that tariff levels, more than SPS, prevent growth in exports for its members. It gave the examples of 6% tariffs on plums in Japan, 15% to 22% tariffs on peaches and nectarines in Vietnam, and 30% tariffs in India and 35% tariffs in Vietnam on pomegranates. It said it hopes that the U.S. takes opportunities to negotiate the elimination of tariffs on fresh fruit.

While the Florida growers did not suggest a remedy, the American Farm Bureau Federation said that trade remedy rules "must be improved" for seasonality and so that one region can find relief -- and suggested that should be a topic in the USMCA review.

However, it did not support the use of reciprocal tariffs to open markets in Mexico, or any other country. If there are tariffs, they should not be on all products, it argued.

"Farm Bureau members support the goal of ensuring fair trade with other nations, but any effort to impose additional tariffs on these nations’ imports runs the risk of significant retaliatory measures against U.S. agricultural exports, which we have already seen implemented by Canada and China this week," the group wrote.

It noted that 47% of agricultural exports went to Mexico, Canada and China, and 75% of ag exports went to 10 markets. It reminded USTR that exports make up more than 20% of farm income.

It also noted that 49% of ag exports were in countries where the U.S. has a free-trade agreement. It added: "An agricultural trade agenda must focus on maintaining existing markets and completing trade agreements that expand market access for U.S. agricultural products."

The farm bureau said by value, 48% of ag exports were consumer products, "like meat, pasta, tree nuts and fresh fruit." Another 32% were unprocessed commodities like soybeans, corn, cotton and tobacco. The rest were intermediate products like ethanol, soybean meal, seeds and the like.

The American Soybean Association wrote that it wants USTR to find ways to attain market access for soybeans and soybean products, and recognized there are non-tariff barriers that prevent reciprocity. (Most countries have low or no tariffs on soy, the group said.)

There are minimal imports of soy to the U.S. because it grows more than it consumes, so a direct reciprocal tariff would be pointless, the group noted.

"We strongly encourage negotiations to remove trade barriers without creating new ones," the association said. It said it would like the U.S. to target China, India, Taiwan, South Korea, Thailand and Vietnam as markets that need reciprocal agreements. "This should be done carefully to preserve current market access and prevent retaliation that will directly affect farmer incomes and livelihoods," they wrote.

It asked that nothing be done to harm soybean exports to the EU, where it said there is a "a very positive and productive trade relationship."

The Renewable Fuels Association said it strongly supports the administration's desire for fair and reciprocal trade in ethanol, and efforts to remove barriers to achieve export growth for American ethanol.

It called for an 18% tariff on Brazilian ethanol if the U.S. cannot convince Brazil to remove its tariff. It said the 18% tariff caused bilateral trade in ethanol to go from a market where the U.S. sold $197 million more to Brazil than it imported in 2018 to now, importing $150 million more than it exported.

However, it said it was "extremely concerned about the growing trade conflict with Canada and its potential impact with respect to U.S. ethanol's continued access to that market. For the last 10 years, Canada has been one of the most consistent and reliable markets for U.S.-sourced ethanol."

The National Cotton Council wrote that subsidies in India and Brazil harm competing U.S. exports.

"While China remains a very important market for U.S. cotton, China’s overall cotton imports, both from the United States and from all export sources, have declined over the past year, due in part to China’s larger crop and opaque control of import quotas," the council wrote. "Just as importantly, China has stimulated massive excess production capacity in manmade fiber (MMF) production, especially in polyester, which is substitutable for cotton fiber. This excess capacity has depressed global demand and prices for cotton."

It said that China's retaliatory tariff of 15% on cotton after the U.S. imposed 20% tariffs on China over fentanyl "will lead to a sharp drop in the U.S. share of China’s import market."

The U.S. Peanut Council said that negotiations, rather than reciprocal tariffs, are the best approach, since U.S. tariffs on peanuts and peanut products are "already relatively high."

It exports 28% of production, more than $900 million in 2024, to 119 countries.

Like others, it noted its sector had been hurt in previous trade wars. When the EU hit peanut butter with a 25% tariff in response to 232 tariffs on its steel, "both shipments and import share have never recovered," even though those tariffs were lifted when the Biden administration granted EU steel exporters tariff rate quota access.

When there aren't retaliatory tariffs, the EU has no tariff on peanuts, and it bought $167 million worth of the nuts last year.

It gave several examples of Asian countries where it cannot compete because those countries have free trade agreements (FTAs) with other peanut-growing countries.

JM Smucker Co. wrote that the ad valorem equivalent tariff on U.S. jam exports to EU countries is about 36%, while the U.S. tariff is under 2% in some cases.

"U.S.-origin exports to the European Union under Harmonized System classification 2007 (Jams, fruit jellies, marmalades, fruit or nut purée and fruit or nut pastes) were only $295,614 in 2024. In stark contrast, U.S. imports of EU products under this same classification were $237.6 million in 2024, accounting for an unacceptable $237.3 million U.S. deficit."

It estimated that the harm to the jam sector is $240 million.

The National Milk Producers Federation wrote that the EU exported $3 billion in dairy products last year, while the U.S. only exported $167 million "due to tariff and regulatory imbalances, including the EU’s GI regime." It asked that geographic indicator rules be addressed "effectively," but didn't say how.

The Cheese Importers Association of America framed dairy trade differently, noting that the U.S. is a net exporter of cheese.

"Since the time the Uruguay Round was signed in 1995, the U.S. dairy industry has migrated from a net importer of dairy to a net exporter (from exporting 4% of dairy to 17% today)," the group wrote, adding in bold: "The current system works."

"U.S. tariffs and trade remedies on imports from our dairy trading partners are already comparable to the tariffs and trade remedies imposed on American products imported to these partners, therefore, no additional tariffs or trade remedies are necessary to promote equal trade. In rare situations where tariffs or systems are not comparable, our organization is committed to supporting negotiations amongst the different parties involved to ultimately support a fair-trade deal for both parties. We have been participating in these negotiations already in both Canada and the E.U.," the group wrote.

They said that exports grew 20% in 2024 compared to 2023, while imports increased 6%. In the decade ending in 2023, cheese exports grew 5.6% annually on average, and imports increased 2.1% annually, they said.

It said its members have 7,000 employees; it also noted that more than 605 of cheese imports are further processed in the U.S.

"Cheese imports in 2024 totaled $1.9 billion, which represents just 0.06% of the total imported value of all imported items into the U.S.," the group asserted.

The National Coffee Association asked that coffee not be subject to tariffs or other trade restrictions "given the absence of domestic alternatives to coffee trade and the devastating impact coffee tariffs would have on U.S. coffee drinkers, U.S. coffee workers, and the U.S. economy."

The American Frozen Foods Association said it exported $614 million in frozen fruits and vegetables, and would like to expand sales in Asia and the Americas. "However, we have found tariff barriers have limited opportunities to enter and compete in key markets for frozen foods including Brazil, India, Vietnam and certain products into Japan," like frozen blueberries, where Trans-Pacific Partnership countries have a tariff advantage. The tariffs range from 10% to 40%, they wrote.

"We believe it is important to note that we are not requesting U.S. tariffs on frozen fruits and vegetables be increased as these four countries do not supply significant quantities of frozen fruits or vegetables to the United States," the group said.

The National Confectioners Association, which represents companies with 58,000 manufacturing jobs, argued against tariffs on Canada and Mexico, and said they support keeping MFN duties for consumer candy and chocolate at current levels of 4% on average.

"For U.S. exports, our industry faces a variety of non-tariff measures, including bans and restrictions on use of FDA-approved color additives in the EU and other markets; bans on use of certain food additives in Japan and other markets; proliferation of non-science-based front-of-pack warning labels in various markets; additional restrictions resulting from nutrient thresholds and warning labels (including sales bans, promotion, marketing, and/or placement restrictions, and sugar taxes) in several markets; numerous and non-harmonized packaging and packaging waste requirements including in the EU; [and] potential complexities in implementing new and proposed deforestation regulations in the EU and UK."

It added, "As the Administration considers appropriate actions to remedy these practices, NCA calls for careful consideration of all available trade policy tools. We strongly urge that this exercise provide an opportunity to negotiate the reduction of trade barriers with key trading partners."

The NCA asked the government not to hike tariffs on cocoa, which can't be grown in the U.S., and noted that sugar is the most protected good in the U.S., resulting in sugar that costs twice what it does in other countries, and shortages for manufacturers.

Meat producers had some of the most detailed submissions about non-tariff barriers to their sales.

The National Park Producers Council described complaints about barriers in 19 countries and the EU, though it did not make dollar estimates on the lost sales that resulted.

It said that pork producers still managed to export $8.6 billion in product.

"Most countries that import pork, including countries where we face trade barriers, would not be competitive in the United States, so adjusting the U.S. barriers on pork to reflect their barriers would not be an effective way to create leverage. This is one reason why negotiating reductions of tariffs and other trade barriers is a better way to achieve reciprocity," the group wrote.

Tyson Foods, which sells butchered chicken, turkey, beef, pork and prepared foods, as well as byproducts used in pet food, animal feed, fertilizers and biofuels, noted that the executive order asked agencies to "identify new opportunities to negotiate agreements." It said negotiating FTAs "is especially important to avoid the U.S. falling behind other countries who are negotiating favorable access for their food and agriculture sectors."

The U.S. Meat Export Federation said red meat exports -- beef, pork and lamb -- totaled $19.1 billion last year.

Most exports go to countries with FTAs, where there is duty-free access, it said. Its top beef export markets are Korea, Japan, China, Mexico and Canada; Japan has a more than 21% tariff, however. China's tariff is 12% (22% now with retaliation).

Its top pork export destinations are Mexico, Japan, China, Canada and Korea, with only China having a tariff, of 37% (now 47% with retaliation).

The group said barriers to pork exports are most noteworthy in the EU, Brazil and the U.K. There is a ban on pork exports to Brazil and "high tariffs and complicated TRQs" in Europe.

For the countries USTR is focused on, the federation estimated it could be selling $110 million to $175 million more than the current $2.2 billion to Korean consumers, with about half of that gain coming if Korea eliminated a ban on direct-slaughter Canadian cattle.

In Taiwan, it estimated it could be selling $30 million to $55 million more in beef (it currently sells $709 million), and $90 million to $100 million more in pork (it sells less than $24 million). It noted that Taiwan rolled back restrictions on ractopamine, but blamed it for not convincing the public that racto is not risky "and this resulted in significant commercial damage to U.S. pork exports to Taiwan, starting in late 2020 and continuing through 2024."

In Brazil, the group estimated there is the possibility to sell $50 million to $80 million annually in beef, $12 million to $15 million in pork, if Brazil ended its ban on pork and changed its "onerous product and label registration process." But, it acknowledged, other Latin American neighbors who are in an FTA with Brazil would have a tariff advantage even with the restrictions resolved.

It said in China, they could sell $180 million to $200 million more in beef, $50 million to $60 million more in pork, if China changed SPS rules and rolled back retaliatory tariffs. It said SPS changes under the Phase One agreement led to "tremendous market access gains" in beef; exports last year were almost $1.6 billion.

In Indonesia, they could sell $100 million to $150 million more in beef if there were more slaughterhouses approved -- 20 are awaiting approval.

In Vietnam, they could sell $20 million to $25 million more in beef, $25 million to $30 million more in pork, with SPS improvements, but noted that the EU, Canada and Russia all have FTAs, and therefore, are stronger positioned.

"U.S. beef is also at a tremendous disadvantage in Thailand and all the Southeast Asian markets because Australia and New Zealand benefit from trade agreements and duty-free access," the federation wrote. Still, it sees a $50 million to $60 million possible market in Malaysia for beef, and a $20 million to $35 million market in Thailand for beef.

It complained that Australia still has a ban on beef exports due to mad cow disease, but said that U.S. beef is more expensive than Australian beef, so it would not be likely to sell much if the ban was lifted.