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NAFTA uncertainties

Wisconsin producers could lose export sales

Recently, president Donald Trump has threatened to pull out of NAFTA if Canada and Mexico couldn’t agree to terms that are more favourable for the U.S. With regard to states such as Wisconsin; nearly half of its dairy, fruit and vegetable exports went to Canada and Mexico last year. The future of the North American Free Trade Agreement is certainly raising concerns there.

All the numbers indicate how crucial trade is to the agriculture industry, says Jim Holte, president of the Wisconsin Farm Bureau Federation. It’s not an option for farmers to pull out of the world market, he said. “If we were to have to change our production levels down to what only could be consumed in this country, it’d be quite the disaster for prices,” Holte said.

According to a leadertelegram.com article, Brian Gould, an associate professor of Agricultural and Applied Economics at UW-Madison, said he’s unsure what will happen if the U.S. were to pull out of NAFTA immediately. The U.S. or its partners may impose new tariffs on products if NAFTA is discarded, Gould said.

“Mexico has been actively exploring trading relationships with some of our competing countries for their dairy imports and there’s a potential that we could lose those markets,” Gould said. “Even if we don’t lose NAFTA, we may lose those markets anyway. Wisconsin producers could be devastated if they lose export sales to Canada and Mexico.”

Publication date: 1/18/2018


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