The United States and Japan announced Wednesday that the two nations would seek a free trade agreement. President Donald Trump and Japan’s Prime Minister Shinzo Abe announced the two nations will soon begin negotiations. Japan has previously feared a bilateral agreement and, instead, urged the U.S. to rejoin the Trans-Pacific Partnership. Japan is thought to block the opening of its agricultural markets to the U.S. through a two-nation pact, and instead opt for TPP. Following the announcement, Agriculture Secretary Sonny Perdue stated the talks are “welcome news since we know that export income is critical to the financial health of agriculture and is a key contributor to rural prosperity.” Perdue called Japan an important customer for U.S. farmers and ranchers. Perdue also called the announcement “proof” that President Trump’s approach to trade will “benefit our entire economy, including the agricultural sector.”
U.S. Wheat Associates (USW) said the announcement to “further expand trade and investment between the United States and Japan in a mutually beneficial manner” has the potential to eliminate a dangerous vulnerability for U.S. wheat farmers. Over the years, Japan has purchased more U.S. wheat than any other country but also imports wheat from Canada and Australia, which are members of the Trans-Pacific Partnership (TPP) along with Japan. Once ratified, this agreement will include a gradual reduction of Japan’s effective tariffs on milling wheat imported from TPP member countries.
Source: NAFB News Service