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Wheat harvest photo
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Give U.S. Wheat Farmers the Freedom to Compete

ARLINGTON, Virginia — The familiar African proverb says that when elephants fight, it is the grass that suffers. Unfortunately for America’s farmers, that grass is the wheat growing in their fields as the big guys in Washington, D.C., and Beijing escalate their trade fight.

China’s state-run importing agency and private flour millers bought an average of more than 1.1 million metric tons of U.S. wheat the past five years because our farmers produce higher quality grain than China can grow on its own. Following the Trump Administration’s announcement of new tariffs on $50 billion of imported Chinese goods, China hit back with tariffs of its own, including a 25 percent tariff on U.S. wheat imports. In response, the White House is ordering trade officials to draw up a list of $200 billion worth of Chinese goods that would be hit with 10 percent tariff on top of the 25 percent tariffs already promised. In a trade war, agriculture always gets hit first and the effects of these tariffs could prove devastating for farmers.

No one in China will be hurt if the retaliatory U.S. wheat tariff is implemented. China has huge amounts of stored wheat and they can purchase what they need from Australia, Canada or even Kazakhstan, although Chinese consumers will miss the opportunity to experience higher quality products made from U.S. wheat. Instead, the outcome is likely to further erode the incomes of farm families who strongly support addressing the real concerns about China’s trade policies.

According to the USDA, net cash wheat farm income is projected to be down more than 21 percent this year compared to last. U.S. wheat growers are not in the business of ceding a market like China that wants to buy their crop and could buy so much more of it. That is why in 2016, U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) called for World Trade Organization (WTO) cases intended to push China to meet its WTO commitments on domestic support and tariff rate quota management. We are happy that the Trump Administration supports and is pursuing those cases.

USW and NAWG know that farmers still want our organizations to keep fighting for fair opportunities to compete in China and other countries. They would prefer, however, to see our government do that first within the processes already in place.

Instead, the Administration is doubling down on a tactical policy that makes an already risky business of agriculture even more volatile. Policies like the ones being proposed will only make times harder for farmers, and the Administration’s vague promises of protection for the farmers we represent offers little consolation.

Our country’s continuing agricultural trade surplus is proof that America’s farmers can compete successfully in the world based on the quality and value of what they produce, given the freedom to do so.

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About U.S. Wheat Associates
USW’s mission is to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers.” USW activities in more than 100 countries are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. For more information, visit our website at www.uswheat.org.

About NAWG
NAWG is the primary representative in Washington D.C. for wheat growers, working to ensure a better future for America’s growers, the industry and the general public. NAWG works with a team of 20 state wheat grower organizations to benefit the wheat industry at state and national levels. From their offices in the Wheat Growers Building on Capitol Hill, NAWG’s staff members are in constant contact with state association representatives, NAWG grower leaders, Members of Congress, Congressional staff members and the public.

Nondiscrimination and Alternate Means of Communications
In all its programs, activities and employment, U.S. Wheat Associates (USW) prohibits discrimination on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact USW at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S., 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, USW, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. USW is an equal opportunity provider and employer.

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Farm Organizations Look for Negotiations with China to Achieve Durable Market Access

WASHINGTON, D.C. — Eighteen U.S. agricultural organizations sent a letter to President Trump on May 31, 2018, expressing hope that he will “prioritize negotiations with China to resolve many longstanding obstacles to U.S. agricultural exports while avoiding mutually destructive tariffs.”

The organizations agree that there are certainly major problems in the U.S. trade relationship with China, and they stated that the Trump Administration has “rightfully identified many unfair trading practices by China that harm the U.S. economy.” The groups want to see a “major recalibration of our trade relationship with China” that would result in U.S. producers “receiving the full benefits of China’s accession to the World Trade Organization.”

Instead of seeing tariffs imposed, the groups support “establishing normal commercial relations with China based on predictability, transparency, and market openness.” These organizations hope that there will be serious, productive, substantive negotiations that will result in “durable market access” for U.S. producers and “policymaking transparency” by Chinese authorities.

“The reputation of U.S. agriculture as a reliable supplier to the world is critical to the future of the industry,” the groups wrote. “We strongly encourage negotiations leading to open and predictable trade, particularly in cooperation with other countries in the region that share our concerns about China’s mercantilist policies.”

The following organizations signed the letter to President Trump:

American Farm Bureau Federation
American Soybean Association
National Association of Wheat Growers
National Barley Growers Association
National Corn Growers Association
National Council of Farmer Cooperatives
National Sorghum Producers
National Sunflower Association
United Fresh Produce Association
U.S. Canola Association
U.S. Dry Bean Council
U.S. Grains Council
U.S. Soybean Export Council
U.S. Wheat Associates
USA Dry Pea & Lentil Council
USA Poultry & Egg Export Council
USA Rice
Western Growers

USW’s mission is to develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers in more than 100 countries. Its activities are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service.

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Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S.- 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

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New Tariffs Could Jeopardize Administration’s Bilateral Trade Agenda

WASHINGTON, D.C. — U.S. Wheat Associates (USW) is once again disappointed that its repeated warnings about the consequences of the Section 232 investigations on steel and aluminum have been ignored and some of our closest allies and trading partners have been hit with new tariffs.

“It is dismaying to see that common sense has not yet prevailed in preventing these protectionist measures,” said Vince Peterson, President of U.S. Wheat Associates. “We’ve spent decades in critical markets like Mexico, Japan, Europe, and others because we’re committed to a lasting trading relationship between their milling and processing sectors and our farmers. If this Administration isn’t careful decades of efforts by our farmers could be wasted.”

If this approach doesn’t change, USW worries that the ambitious bilateral trade agreement agenda, which was promised and which we all look forward to, will never get off the ground because no country will be willing to take the political risks needed to negotiate an agreement with the United States.

The Department of Commerce is also in the process of a new Section 232 investigation on imports of automobiles and parts, the value of which far exceeds steel and aluminum imports, and primarily affects major wheat export markets like Mexico, Japan and the European Union, as well as Canada.

USW’s mission is to develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers in more than 100 countries. Its activities are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service.

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Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S.- 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

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Wheat Groups Welcome Counternotification on India’s Reports to WTO

ARLINGTON, Virginia — This week, the U.S. Trade Representative (USTR) formally questioned data India has reported to the World Trade Organization (WTO) about its market price support programs for wheat and rice from marketing years 2010/11 to 2013/14. U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) consider this counternotification (CN) to the WTO Committee on Agriculture as an appropriate and welcome step that further brings transparency to countries’ farm support programs.

“We want to thank USTR and USDA leadership, including Ambassador Robert Lighthizer, Secretary Sonny Perdue, Chief Agricultural Negotiator Gregg Doud, and U.S. Ambassador to the WTO Dennis Shea, and the hardworking staff at USTR and USDA for using available tools to call attention to this abuse of WTO rules,” said USW Chairman Mike Miller, a wheat farmer from Ritzville, Wash. “The proactive use of WTO tools like counternotifications and dispute settlement will help build support for the global trade rules that provide a bulwark against market distorting policies that hurt American farmers.”

India’s domestic support scheme, which USTR and USDA demonstrate is vastly under-reported, creates excess capacity that prevents trade opportunities and sometimes has led to India dumping excess capacity from its massive public stocks. In 2013/14 India was the seventh largest wheat exporter in the world and consistently the largest rice exporter.

The U.S. counternotification covers India’s market price support for wheat and rice. Under its WTO commitments, India may provide subsidies equal to no more than 10 percent of the total value of crop production. In the years covered in the CN, the United States demonstrates through India’s own data that its price support appears to be the equivalent of 60 percent to 68 percent of the value of production for wheat and 74 percent to 84 percent of the value of production for rice.

“India’s large price support program has a negative effect on international markets,” said NAWG President Jimmie Musick, a wheat farmer from Sentinel, Okla. “We welcome this signal from our government that it is not going to accept obvious attempts to cheat the system by India and other countries. We thank the USTR and USDA for its creativity in challenging this policy by being the first country to use the WTO’s counternotifications rule on agricultural domestic support.”

If India does not take corrective actions to bring its programs in line with its WTO commitments, USW and NAWG hope that the United States will coordinate with other affected countries to consider putting forward a dispute settlement case, as it did with China’s domestic support and tariff rate quota policies.

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About U.S. Wheat Associates
USW’s mission is to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers.” USW activities in more than 100 countries are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. For more information, visit our website at www.uswheat.org.

About NAWG
NAWG is the primary representative in Washington D.C. for wheat growers, working to ensure a better future for America’s growers, the industry and the general public. NAWG works with a team of 20 state wheat grower organizations to benefit the wheat industry at state and national levels. From their offices in the Wheat Growers Building on Capitol Hill, NAWG’s staff members are in constant contact with state association representatives, NAWG grower leaders, Members of Congress, Congressional staff members and the public.

Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S. – 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

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Wheat Groups Applaud Decision to Negotiate for TPP Membership

ARLINGTON, Virginia — U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) are very happy to learn that President Trump is directing U.S. Trade Representative (USTR) Robert Lighthizer and National Economic Council Director Larry Kudlow to begin negotiating for the United States to join the Trans-Pacific Partnership (TPP).

“Putting it simply, joining TPP is the best way to avoid a potentially devastating loss of wheat sales to Japan,” said USW Chairman Michael Miller, a wheat farmer from Ritzville, Wash. “If the United States joins TPP, U.S. wheat should be able to compete on a level playing field with Canadian and Australian wheat, which will soon have a major advantage once TPP is implemented. That would keep U.S. wheat sales that currently represent 50 percent of Japan’s total wheat imports competitive in this crucial market.”

“It is very encouraging that the President is taking this step,” said NAWG President Jimmie Musick, a wheat grower from Sentinel, Okla. “If we can find a way to join this trade agreement, it will go a long way toward helping protect the incomes of every American wheat farmer. We also want to thank the members of Congress who pushed very hard to see this opening.”

USW and NAWG look forward to working with the Administration to provide any information and support it needs to achieve a successful negotiation that brings the United States back into the agreement.

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About U.S. Wheat Associates
USW’s mission is to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers.” USW activities in more than 100 countries are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. For more information, visit our website at www.uswheat.org.

About NAWG
NAWG is the primary representative in Washington D.C. for wheat growers, working to ensure a better future for America’s growers, the industry and the general public. NAWG works with a team of 20 state wheat grower organizations to benefit the wheat industry at state and national levels. From their offices in the Wheat Growers Building on Capitol Hill, NAWG’s staff members are in constant contact with state association representatives, NAWG grower leaders, Members of Congress, Congressional staff members and the public.

Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S. – 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

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China’s Response to New U.S. Tariffs Will Hurt U.S. Wheat Farmers

ARLINGTON, Virginia — With the announcement today that China intends to retaliate against the latest proposed U.S. tariffs, hard-working U.S. farmers are clearly in the line of fire from what looks more and more like an escalating trade war with China.

U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) believe wheat farmers are going to get hurt by the 25 percent tariffs China quickly proposed after the United States government announced new tariffs on $50 billion of imported Chinese goods on April 4, 2018.

“People may not know that China imported more than 61 million bushels of U.S. wheat in marketing year 2016/17, making it our fourth largest buyer in the world,” said USW Chairman Mike Miller, a wheat farmer from Ritzville, Wash. “Farmers across the country have invested a lot of money and time over the years to develop a Chinese market that has great potential to buy even more American wheat. Now that effort is in jeopardy at a time when big global supplies have already pushed farm gate wheat prices down to unsustainable levels.”

“America’s wheat farmers are experiencing several hardships and adding a 25 percent tariff on exports to China for U.S. wheat is the last thing we need during some of the worst economic times in farm country,” stated NAWG President Jimmie Musick a wheat farmer from Sentinel, Okla. “Continued drought, low prices and trade uncertainty adds pressure to passing a Farm Bill on time as well as creating uncertainty for producers and lenders. In a trade war, agriculture is always the first target. The Administration can support rural Americans by working with Chinese officials to avoid these damaging tariffs.”

The proposed Chinese tariffs would further erode the incomes of farm families who strongly support addressing the real concerns about China’s trade policies. USW and NAWG know that farmers still want our organizations to keep fighting for fair opportunities to compete in China and other countries. They would prefer, however, to see our government do that within the processes already in place, as the Administration has done by challenging China’s domestic support and tariff rate quota policies through World Trade Organization (WTO) dispute cases.

We have also said that the proposed U.S. tariffs represent unilateral actions that violate WTO rules. We urge the Administration to pull back from this dangerous course that puts vulnerable U.S. industries like wheat production at risk and in a larger sense undermine the established rules-based global trading system.

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About U.S. Wheat Associates
USW’s mission is to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers.” USW activities in more than 100 countries are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. For more information, visit our website at www.uswheat.org.

About NAWG
NAWG is the primary representative in Washington D.C. for wheat growers, working to ensure a better future for America’s growers, the industry and the general public. NAWG works with a team of 20 state wheat grower organizations to benefit the wheat industry at state and national levels. From their offices in the Wheat Growers Building on Capitol Hill, NAWG’s staff members are in constant contact with state association representatives, NAWG grower leaders, Members of Congress, Congressional staff members and the public.

Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S. – 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

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Wheat Grower Organizations: Enforcing Trade Rules is Best Done Within the Rules

ARLINGTON, Virginia — While U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) understand and support the need to enforce international trade rules, we are very concerned about the implications of the Trump Administration’s decision today to impose more than $60 billion in tariffs on Chinese goods under Section 301 of the Trade Act of 1974.

We agree that unfair Chinese government policies create unnecessary trade distortions that hurt U.S. farmers and other industries. Our organizations urged the U.S. government to challenge China’s domestic price support and tariff rate quota compliance that led to cases disputing these policies within the World Trade Organization (WTO). Such cases served notice to China and our trading partners that the United States would lead a legitimate effort to enforce existing trade rules — by following those rules. We believe that it is in the nation’s best interests, and the interests of the wheat farmers we represent, to challenge trade distorting policies to the maximum extent possible within WTO rules.

It is unfortunate that the well-intentioned decision to challenge other Chinese trade policies has been implemented in a way that violates the rules outlined in Article II of the GATT Agreement. Recent actions including withdrawal from the Trans-Pacific Partnership and implementing steel and aluminum tariffs on the basis of national security have already undermined U.S. leadership in international trade. Now this action further erodes historical support for rules-based trade policies, even though China will likely bring a case against the tariffs within the WTO dispute settlement process.

In addition, USW and NAWG fear that applying unilateral tariffs could invite retaliation that, as recent history shows, would be aimed at U.S. agricultural products. This could very well include China throwing up road blocks to U.S. soybeans, wheat, corn and other commodity imports, which would cut into already unsustainable farm incomes.

We welcome the administration’s strong support for enforcing trade rules. We only wish it would have challenged China’s state-driven policies in ways that complied with and strengthened existing trade rules.

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About U.S. Wheat Associates
USW’s mission is to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers.” USW activities in more than 100 countries are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. For more information, visit our website at www.uswheat.org.

About NAWG
NAWG is the primary representative in Washington D.C. for wheat growers, working to ensure a better future for America’s growers, the industry and the general public. NAWG works with a team of 20 state wheat grower organizations to benefit the wheat industry at state and national levels. From their offices in the Wheat Growers Building on Capitol Hill, NAWG’s staff members are in constant contact with state association representatives, NAWG grower leaders, Members of Congress, Congressional staff members and the public.

Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S. – 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

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Wheat Organizations Ask USTR to Work Toward Re-Joining TPP to Prevent Serious Revenue Loss

ARLINGTON, Virginia — U.S. Wheat Associates (USW), the National Association of Wheat Growers (NAWG) and 33 state wheat organizations have expressed hope in a letter to U.S. Trade Representative (USTR) Robert Lighthizer that the Administration will immediately prioritize accession to TPP to save the valuable Japanese market for U.S. wheat farmers.

“Once TPP is ratified, U.S. wheat exports to Japan will be at serious risk,” the letter stated. “TPP will reduce the effective tariffs that Japanese flour millers pay for imported Australian and Canadian wheat over nine years from about $150 to about $85 per ton. Effective tariffs on imported U.S. wheat would remain at about $150 per ton. Loss in market share and its negative effect on farmgate prices are likely to come much sooner, as Japanese millers reformulate their product mix to avoid the need to purchase artificially expensive U.S. wheat. Lost market share is incredibly difficult to regain.”

The wheat industry organizations noted that Japan has, on average, imported more U.S. wheat than any other country for many years. U.S. wheat market share is typically more than 50 percent of the 6 million metric tons (MMT) of wheat Japan imports annually. Sources within the Japanese milling industry however estimate that could quickly fall to less than 25 percent under TPP 11 rules. At the average price Japan has been paying for U.S. wheat the past five years, that would represent an annual loss of almost $500 million for farmers, rail and barge operators and grain handlers.

“Unfortunately, the agreement among the TPP members will have a devastating impact in rural communities across the wheat belts of the Great Plains and the Northwest, though it will hurt the income of every American farmer growing wheat,” the letter continued. “The President has promised to negotiate great new deals. American agriculture now counts on that promise and American wheat farmers – facing a calamity they would be hard pressed to overcome – now depend on it.”

The organizations said they welcomed the President’s recent openness to joining TPP if better terms for the United States can be negotiated. They also suggested that Ambassador Lighthizer could include acceding to the TPP as an objective in the Administration’s report to Congress that will outline its request to extend Trade Promotion Authority.

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About U.S. Wheat Associates
USW’s mission is to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers.” USW activities in more than 100 countries are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. For more information, visit our website at www.uswheat.org.

About NAWG
NAWG is the primary representative in Washington D.C. for wheat growers, working to ensure a better future for America’s growers, the industry and the general public. NAWG works with a team of 20 state wheat grower organizations to benefit the wheat industry at state and national levels. From their offices in the Wheat Growers Building on Capitol Hill, NAWG’s staff members are in constant contact with state association representatives, NAWG grower leaders, Members of Congress, Congressional staff members and the public.

Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S. – 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

Letter:

The Honorable Robert E. Lighthizer
Ambassador
United States Trade Representative
600 17th Street, NW
Washington, DC 20508

March 7, 2018

Dear Ambassador Lighthizer,

As you prepare the Administration’s report to Congress accompanying the request for extension of Trade Promotion Authority (TPA), the undersigned organizations strongly urge including the objective of acceding to the Trans-Pacific Partnership (TPP) before the extension of TPA expires on July 1, 2021.

As representatives of more than 140,000 American wheat farmers, we welcomed President Trump’s recent comments suggesting openness to joining the TPP. Unfortunately, that has become an urgent need as the eleven members of TPP plan to sign the agreement on March 8th in Chile. We hope that the Administration will immediately prioritize accession to TPP in order to save the valuable Japanese market for U.S. wheat farmers.

Once TPP is ratified, U.S. wheat exports to Japan will be at serious risk. Australia and Canada – both TPP members – are major competitors to U.S. farmers in wheat and other agricultural products. TPP will improve their access to several markets, resulting in an erosion of U.S. market share, particularly in Japan, and a major hit on farm income at home.

TPP will reduce the effective tariffs that Japanese flour millers pay for imported Australian and Canadian wheat over nine years from about $150 to about $85 per ton. Effective tariffs on imported U.S. wheat would remain at about $150 per ton. Loss in market share and its negative effect on farmgate prices are likely to come much sooner, as Japanese millers reformulate their product mix to avoid the need to purchase artificially expensive U.S. wheat. Lost market share is incredibly difficult to regain.

In many ways, the Japanese market has been the backbone of the U.S. wheat industry for decades because of its consistent demand for high quality wheat. That is now at serious risk. Japan imports around 3 million metric tons (MMT) of U.S. wheat per year, with an average value of over $800 million. Sources inside the Japanese milling industry tell us this $65 per ton disadvantage will force them to cut U.S. wheat to about 1.35 MMT, a loss of approximately $500 million per year.

Unfortunately, the agreement among the TPP members will have a devastating impact in rural communities across the wheat belts of the Great Plains and the Northwest, though it will hurt the income of every American farmer growing wheat. The President has promised to negotiate great new deals. American agriculture now counts on that promise and American wheat farmers – facing a calamity they would be hard pressed to overcome – now depend on it.

Like President Trump, American farmers do not enjoy losing to their competitors. They want to make great deals and see their family businesses thrive. If the President brings us into TPP, U.S. farmers can start winning again among the world’s most important agricultural markets. The undersigned organizations strongly urge you to put forward the objective of U.S. membership in TPP to prevent this market loss and put the farmers we represent on a strong foundation for the future.

Sincerely,

National Association of Wheat Growers
U.S. Wheat Associates
Arizona Grain Research & Promotion Council
California Association of Wheat Growers
California Wheat Commission
Colorado Association of Wheat Growers
Colorado Wheat Administrative Committee
Idaho Grain Producers Association
Idaho Wheat Commission
Kansas Association of Wheat Growers
Kansas Wheat Commission
Kentucky Small Grain Growers’ Association
Maryland Grain Producers Association
Maryland Grain Producers Utilization Board
Minnesota Association of Wheat Growers
Minnesota Wheat Research & Promotion Council
Montana Grain Growers Association
Montana Wheat & Barley Committee
Nebraska Wheat Board
Nebraska Wheat Growers Association
North Carolina Small Grain Growers Association
North Dakota Grain Growers Association
North Dakota Wheat Commission
Ohio Corn & Wheat Growers Association
Oklahoma Wheat Commission
Oklahoma Wheat Growers Association
Oregon Wheat Commission
Oregon Wheat Growers League
South Dakota Wheat Inc.
Texas Wheat Producers Association
Texas Wheat Producers Board
Washington Association of Wheat Growers
Washington Grain Commission
Wyoming Wheat Growers Association
Wyoming Wheat Marketing Commission

cc:
The Honorable Sonny Perdue, Secretary, U.S. Department of Agriculture
The Honorable Wilbur Ross, Secretary, U.S. Department of Commerce
The Honorable Pat Roberts, Chairman, Senate Agriculture, Nutrition & Forestry Committee
The Honorable Debbie Stabenow, Ranking Member, Senate Agriculture, Nutrition & Forestry Committee
The Honorable Orrin Hatch, Chairman, Senate Finance Committee
The Honorable Ron Wyden, Ranking Member, Senate Finance Committee
The Honorable Michael Conaway, Chairman, House Agriculture Committee
The Honorable Collin C. Peterson, Ranking Member, House Agriculture Committee
The Honorable Kevin Brady, Chairman, House Ways & Means Committee
The Honorable Richard Neal, Ranking Member, House Ways & Means Committee

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Steel, Aluminum Tariffs Raise the Risk of Retaliation Against U.S. Agriculture

ARLINGTON, Virginia — U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) are extremely disappointed in the decision announced today to impose sweeping tariffs on imports of steel and aluminum. We have repeatedly warned that the risks of retaliation and the precedent set by such a policy have serious potential consequences for agriculture. It is dismaying that the voices of farmers and many other industries were ignored in favor of an industry that is already among the most protected in the country.

If the United States is taken to dispute settlement at the World Trade Organization (WTO) for imposing these tariffs, we call on the U.S. Trade Representative (USTR) to avoid invoking the essential security exception under GATT Article XXI. The recent Department of Defense memorandum made it clear that imported steel and aluminum did not threaten its ability to acquire enough from domestic suppliers to meet its needs. The USTR should not take the extraordinary step of invoking Article XXI to defend what we believe is protectionism.

At NAWG’s board of directors meeting this week, a new resolution was passed urging the Administration to avoid imposing national security-based trade barriers on commonly traded products. NAWG’s newly instated President Jimmy Musick, a wheat farmer from Sentinel, Oklahoma, said “at such an economically hard time for wheat growers, we do not want to see trade barriers brought against us from some of our top customers who are impacted by this decision.”

Wheat farmers battling a market in which China holds almost 50 percent of world ending wheat stocks can sympathize with steel and aluminum workers on the economic effects of Chinese policies leading to global oversupply. However, we hope that our legitimate concerns with this action are heard and taken into consideration in this process.

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About U.S. Wheat Associates
USW is the export marketing organization for U.S. wheat farmers. Its mission is to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers.” USW activities around the world are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. For more information, visit our website at www.uswheat.org.

About NAWG
NAWG is the primary representative in Washington D.C. for wheat growers, working to ensure a better future for America’s growers, the industry and the general public. NAWG works with a team of 20 state wheat grower organizations to benefit the wheat industry at state and national levels. From their offices in the Wheat Growers Building on Capitol Hill, NAWG’s staff members are in constant contact with state association representatives, NAWG grower leaders, Members of Congress, Congressional staff members and the public.

Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S. – 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

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TPP 11 Puts U.S. Wheat Exports to Japan at Risk

ARLINGTON, Virginia — U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) have expressed concern that the recent announcement that the eleven remaining TPP members have concluded talks on a revised deal without us is a looming disaster for U.S. wheat farm families and related industries. It puts U.S. wheat exports at serious risk in Japan, which has been our largest, most consistent importer for decades.

President Trump recently suggested that we could reconsider the decision not to join TPP if a better deal is possible. The President is a tough negotiator and clearly wants a good deal for the United States. It would be a better deal for wheat farmers now if the Administration would apply its strength to open the door all the way to negotiating a better TPP deal or bilateral solutions to protect the crucial Japanese market and help open other wheat markets like Vietnam.

TPP 11 calls for gradually discounting effective tariffs that Japanese flour millers pay for imported Australian and Canadian milling wheat over 9 years from about $150 to about $85 per metric ton (MT). Imported U.S. wheat effective tariffs would remain at about $150 per MT.

Sources within the Japanese milling industry estimate this $65 per metric ton disadvantage would eventually force them to find alternatives to U.S. wheat and cut average total imports of Western White, dark northern spring (DNS) and hard red winter (HRW) wheat from about 3.1 million metric tons (MMT) per year to as little as 1.35 MMT per year. U.S. wheat farmers and the U.S. grain trade will essentially be writing a $500 million check every year to Australian and Canadian farmers, even at today’s relatively low wheat prices, if nothing changes before the effective tariff schedule is fully implemented.

The agreement that the eleven remaining TPP members announced was designed to provide an opening for the United States to re-engage in the agreement, so we do not have to sit on the sidelines.

American agriculture now counts on the Administration’s strong negotiating skills; and American wheat farmers, facing a calamity they would be hard pressed to overcome, now depend on it.

The TPP 11 countries include Canada and Australia, which are major competitors to the United States in the Japanese wheat market. Other TPP countries with rapidly growing demand for imported wheat include Mexico, Vietnam, Malaysia, Chile and Peru. Singapore, Brunei and New Zealand round out the remaining TPP partner countries

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About U.S. Wheat Associates
USW’s mission is to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. producers and its value for their customers.” USW activities in more than 100 countries are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. For more information, visit our website at www.uswheat.org.

About the National Association of Wheat Growers
NAWG is the primary policy representative in Washington D.C. for wheat growers, working to ensure a better future for America’s growers, the industry and the general public. NAWG works with a team of 20 state wheat grower organizations to benefit the wheat industry at the national levels. From their offices in the Wheat Growers Building on Capitol Hill, NAWG’s staff members are in constant contact with state association representatives, NAWG grower leaders, Members of Congress, Congressional staff members, Administration officials and the public.

Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S.- 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

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