U.S., Australia Sign FTA Trade Agreement Doesn't Have Support Of Most U.S. Farm Groups
May 24, 2004
By Jerry Hagstrom, Agweek

WASHINGTON - U.S. and Australian officials signed a free trade agreement last week that may - or may not - result in a confrontation between American manufacturing and agriculture and even between American economic and security interests.

U.S. manufacturers desperately want this agreement because it would remove all Australian tariffs on 99 percent of U.S. manufactured goods. Rep. Jennifer Dunn, R-Wash., a co-founder with Rep. Cal Dooley, D-Calif., of the Australia caucus in Congress, noted at the elaborate signing ceremony on May 18 that it would make it easier for the Boeing company to sell airplanes to Qantas, the Australian carrier.

But most American farm groups and agribusinesses are not supporting it, although for opposite reasons. The farm groups don't like the U.S.-Australian agreement because it reduces tariffs and other restrictions on most Australian commodities coming into the United States and is likely to result in increased imports of beef, lamb and dairy products. Many agribusiness groups such as the Grocery Manufacturers of America and the National Food Processors Association don't like the agreement because it did not reduce restrictions on U.S. sugar imports. The American Meat Institute, whose members include importers of meat from Australia, is supporting the agreement but the National Chicken Council is opposing it, a spokesman said, because Australia won't let in any U.S. chicken unless "it's cooked for such a time and at such a high temperature it is not edible."

Of the farm groups, the National Farmers Union and R-CALF USA, a cattle group, have taken positions in direct opposition to the agreement. The National Cattlemen's Beef Association's executive committee has issued a statement that, "We oppose any Australian free trade agreement that does not include adequate safeguards." Greg Doud, the NCBA's chief economist, added, "We're sure not going to the Hill and lobby for it."

The Citizens Trade Campaign, which includes the National Family Farm Coalition and Public Citizen as well as environmental, labor and church groups, said in a statement that it opposing the agreement because "it could hurt thousands of family farmers and ranchers, especially in the dairy, beef and wheat sectors." A Citizens Trade Campaign spokesman said the group also objected the agreement's provisions that would force Australia to make some changes in the way it approves drugs.

Whether the farm and agribusiness groups actively lobby against the measure as it moves through Congress may depend on whether the agreement is offered in tandem with a trade agreement with Morocco that provides benefits to U.S. agriculture and whether Australia agrees to remove certain animal and plant health restrictions on U.S. products before the votes occur. Senate Finance Committee Chairman Charles Grassley, R-Iowa, has suggested that voting on the two agreements the same day might make it easier for members to vote for both, but both U.S. and Australian business interests have questioned that strategy.

The National Milk Producers Federation is opposed to the agreement because it will bring in more dairy products, but NMPF spokesman Chris Galen said whether the dairy farmers will be "active, hyperactive or passive-aggressive" might depend issues such as whether Congress takes up the agreement with Morocco.

U.S. wheat groups are refusing the support the U.S.-Australian agreement because it made no changes in the Australian Wheat Board, a state enterprise they contend engages in unfair competition, but wheat leaders haven't decided whether to do more than write a letter to Congress about their opposition.

The American Farm Bureau Federation has said Australia still must remove restrictions on U.S. citrus, poultry, stone fruit and apples for the agreement to provide enough benefit to U.S. farmers for the group to support the agreement. When an Australian legal review recently ruled to approve U.S. pork imports, Farm Bureau said it was "pleased," but that it still needed access for the other products. But the Australian action on pork was not enough to encourage the National Pork Producers Council to decide before the signing ceremony whether it will now support the agreement.

The Farm Bureau, the NPPC and the American Soybean Association were rare among farm groups in sending representatives to the signing ceremony May 18. Chris Garza, the Farm Bureau representative, said he was there because the Australians last week "sent a sign they are willing to work" on the animal and plant health issues.

But when Australian Trade Minister Mark Vaile was asked after the ceremony if Australia would make more adjustments in its animal and health plant rules, he said he was "not sure on the timetable of those scientific analyses." Vaile also said he had told Farm Bureau

President Bob Stallman that Australia has plenty of pending issues with the United States over animal and plant health restrictions.

It's also likely that Bush administration officials, U.S. manufacturing executives, Australian government and business leaders and congressional leaders who favor the agreement will argue that Congress should pass it as a reward to Australia for its support of the U.S. war in Iraq.

Both U.S. Trade Representative Bob Zoellick and Vaile openly noted the strong U.S.-Australian security tie in their remarks at the ceremony. Zoellick said Americans and Australians have "suffered together and even died together" because "Australians and Americans will never accept that tyranny is the natural order." Vaile said, "This is the commercial equivalent of the Anzus Treaty" under which the United States and Australia have agreed to defend each other. Vaile added that U.S. and Australian troops "are engaged in a physical and psychological battle in Iraq" so that "Iraqis can enjoy the freedom and prosperity" the same as Americans and Australians.

Their statements indicate that many farm leaders don't have the stomach to fight hard against the Australian agreement. But if farmers around the country really believe that the U.S.-Australian agreement is bad for American agriculture, they will need to tell their leaders in Washington they may have to engage in some real arm twisting rather than sit passively on the sidelines.

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