Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The...

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Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn Kennedy and Flynn Adcock Center for North American Studies Louisiana State University and Texas Agrilife Research Prepared for the SAEA Annual Meetings Dallas, TX February 4, 2008

Transcript of Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The...

Page 1: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Unilateral Trade Policies andSouthern Agriculture

Presentation at SAEA Organized Symposium:

The Impacts U.S. Trade Policieson Southern Agriculture

Lynn Kennedy and Flynn Adcock Center for North American Studies

Louisiana State University and Texas Agrilife Research

Prepared for the SAEA Annual MeetingsDallas, TX February 4, 2008

Page 2: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Overview

History of U.S. Trade Sanctions

Impacts of Trade Sanctions on Agriculture

The Case of Cuba – Economic Impacts

Summary and Implications

Page 3: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

History of U.S. Trade Sanctions The U.S. has imposed trade sanctions on numerous

countries for various stated reasons since 1950 North Korea – War, Nuclear Weapons Vietnam – War, MIA Issues Cuba – Communist Takeover, African Involvement Libya – Support of Terrorism, Pan Am 103 USSR – Invasion of Afghanistan Iran – Support of Terrorism, Suspected WMDs Sudan – Civil War, Human Rights, Terrorism Iraq – Invasion of Kuwait, Suspected WMDs

Each time, important markets lost, especially Cuba, and especially for rice, wheat, and other grains

Now trading with, or at least exporting to, most, but lost market share over the years

Page 4: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Agricultural Imports for Countries Targeted by U.S. Sanctions, 2006

 Agricultural

ImportsImports from

U.S.Percent from

U.S.

  Million Dollars  

Cuba $1,039 $328.2 31.6%

Vietnam $3,464 $216.0 6.2%

Sudan $1,147 $71.6 6.2%

Iran $5,110 $5.1 0.1%

Libya $1,216 $33.8 2.8%

Source: www.wto.org, www.fas.usda.gov/ustrade, and www.usitc.gov

Page 5: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Selected Ag Imports for CountriesTargeted by U.S. Sanctions, 2005

Source: US Trade Intenet System, www.fas.usda.gov/ustrade and Food and Agricultural Organization of the UN, www.fao.org

$396 $389 $377

$79 $79$55 $47 $40 $37 $29 $24

Iran SBO

Iran Rice

Iran Corn

Libya Wheat

Iran SBM

No Korea Rice

Libya Corn

No Korea Corn

Vietnam Corn

Libya SBM

No Korea SBO

$0

$100

$200

$300

$400

$500

Million Dollars

U.S. Had No Exports of these Products to these Markets during 2005;None or Negligible Most Years

Page 6: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Selected Ag Imports to Cuba , 2006

Source: U.S. Trade Intenet System, www.fas.usda.gov/ustrade and www.usitc.gov

$144$136

$60 $58$51

$32

Meat

Wheat

CornForestry

RiceSoybeans

$0

$20

$40

$60

$80

$100

$120

$140

$160

Million Dollars

Other U.S.

Page 7: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

U.S. Agricultural and Related ProductsExports to Cuba, 2002 - November 2007

Source: U.S. Trade Internet System, www.fas.usda.gov/ustrade

$139.8

$248.4

$388.7

$351.4$328.2

$371.1

2002 2003 2004 2005 2006 Jan-Nov 07$0.0

$50.0

$100.0

$150.0

$200.0

$250.0

$300.0

$350.0

$400.0

$450.0Million Dollars

Likely New

Record in 2007

Page 8: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Southern U.S. Agricultural Exports to Cuba, Major Products, 2006

Source: U.S. Trade Intenet System, www.fas.usda.gov/ustrade

$26.3

$9.7$8.7 $8.3

$6.7$5.6

$4.5 $4.3 $3.9$2.9 $2.9 $2.3 $1.9 $1.3

$0.4

AR TX NC MS

GA LA AL KY OK VA TN SC MD

FL WV

$0.0

$5.0

$10.0

$15.0

$20.0

$25.0

$30.0

Million Dollars

$89.4 Million Total31.8% of U.S. Total

Products included are Grains, Soybeans, Soybean Products, Poultry

Meat, Pork, Beef, Seeds, Cotton, Animal Fats, & Wood Products

Page 9: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Composition of Southern U.S. Exports to Cuba, 2006

Source: U.S. Trade Internet System, www.fas.usda.gov/ustrade

Grains$38,279

Poultry Meat$30,219Soybeans & Products

$10,573

Wood Products$6,056

Other Meats$2,814

Other$1,430

Thousand Dollars

$89.4 Million Total

Page 10: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Economic Impacts of Southern U.S. Exports to Cuba, 2006

Business Activity Income Employment

(Million Dollars) (Jobs)

Direct $89.4 $27.8 1,332

Indirect & Induced

$104.0 $48.9 669

Total $193.4 $76.7 2,001

Source: Center for North American Studies, using IMPLAN Input/Output Model

Page 11: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Byrd Amendment/Crawfish The Byrd Amendment directed the U.S. Bureau of

Customs and Border Protection to distribute monies to companies that petitioned or supported antidumping and countervailing duty actions.

In the case of the U.S. crawfish industry, companies that did not petition or support antidumping actions against Chinese crawfish imports were not included in a $7.5 million payout by Customs as a result of a 1997 antidumping order on crawfish tailmeat imports from China.

Page 12: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Byrd Amendment/Crawfish

Crawfish Processor Information: 2000-2004    

  2000 2001 2002 2003 2004

Number of Firms 24 23 29 28 27

Total Pounds 269,381 665,232 1,711,985 2,056,336 1,697,270

Pounds/Firm 11,224 28,923 59,034 73,441 62,862

Top 3 Processor Share 0.42 0.57 0.47 0.38 0.32

Top 5 Processor Share 0.61 0.71 0.60 0.52 0.49

Herfindahl Index 0.10 0.18 0.12 0.08 0.07

Page 13: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Summary and ConclusionsMany Times Agriculture Has Borne

Disproportionate Share of the BurdenSanctions Are Disruptive, May Harm US

Producers & Likely Ineffective if UnilateralSouthern Rice, Corn, Wheat, Meats Harmed

by SanctionsUS Ag Export Growth to Cuba Impressive-

Likely Politically MotivatedEconomic Impacts to Southern U.S. is

Substantial

Page 14: Unilateral Trade Policies and Southern Agriculture Presentation at SAEA Organized Symposium: The Impacts U.S. Trade Policies on Southern Agriculture Lynn.

Implications

As Sanctions are Lifted, There is an Educational Role to Inform

Important to Be Objective, Staying Out of the Political Fray

Staying Out of the Process may Cost Producers in some Cases (Byrd/Crawfish)

Geopolitical Considerations Always Trump Agricultural Interests