Why U.S. agriculture believes CUSMA will survive Trump's threats

Whatever disparaging things U.S. Chairperson Donald ruff may at present say nigh the merchandise deal he negotiated with Canada and Mexico during his first term, key players in Washington's well-connected agricultural lobby are confident the agreement will live on.

Trump has recently described the Canada-U.S.-Mexico Agreement (CUSMA) as irrelevant, claimed the U.S. Would be better off without it and suggested the deal's best feature is the ability to terminate it.

Despite that, leaders of the U.S. Agriculture industry — a sector strongly in favour of CUSMA — aren't worried about the trade deal's future as it heads into a joint review on July 1.

The message from agriculture insiders at a conference in Washington, D.C., on Wednesday was that the agreement has delivered widespread benefits to U.S. Farmers, the food-processing industry and consumers.

They believe the deal Trump signed his first term has been far too successful for him to tear up in his second.

Two conference speakers were members of the U.S. Negotiating team during the talks that led to the agreement's signing in 2018. The agreement is known in the U.S. As USMCA.

Darci Vetter, now vice-president of public affairs for Driscoll's, one of North America's largest fruit producers, was chief agricultural negotiator in the Office of the U.S. Trade Representative from 2014 to 2017 under the Obama administration.

"For all of the bluster and the questioning of the agreement, you have industries across all three countries that are already highly integrated and are very committed to making this work," Vetter said.

Canada and Mexico are the only countries granted broad exemptions from Trump's global tariffs, which Vetter attributes to the strength of CUSMA.

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However, she warns that the path to a renegotiated deal won't likely be smooth or easy.

"I think it could be a bumpy ride," Vetter said.

"I don't think we should underestimate the extent to which the president himself questions trade relationships and trade agreements, and I think some of his concerns are sincere. But I do think at the end of the day, we will still wind up with an agreement."

CUSMA remains in force until 2036 unless one of the countries gives six months' notice of withdrawal. It's unclear whether Trump has the power to pull the U.S. Out of the deal without the backing of Congress.

While Canada and Mexico have said they want the agreement extended beyond 2036, the Trump administration is using the joint review as an opportunity to renegotiate some of CUSMA's terms.

The U.S. Has held two rounds of formal negotiations with Mexico and has another scheduled for mid-July. Meanwhile, Canada's negotiations with the U.S. Are lagging, although Canada-U.S. Trade Minister Dominic LeBlanc has met twice this month with U.S. Trade Representative Jamieson Greer.

Injecting uncertainty into the talks is part of the negotiating process, said John Bode, president and CEO of the U.S. Corn Refiners Association.

"The evidence is so compelling that this agreement is to the benefit of North Americans, whether in Canada, the U.S. Or Mexico, and it would be bad for all of us for it to fall apart," said Bode

Gregg Doud, who served as the U.S. Chief agricultural negotiator for nearly three years during Trump's first term, also expressed strong support for CUSMA.

Doud, now the president and chief executive of the National Milk Producers Federation, praised the deal as the "gold standard" for trade agreements worldwide.

"This is the template. We're really not going to deviate from that going forward," Doud told the conference, organized by the Center for Strategic and International Studies think tank.

He singled out CUSMA's mechanism for resolving trade disputes between the three countries as a major improvement over its predecessor, the North American Free Trade Agreement (NAFTA).

"You can always make it better," Doud said. "But it is so much better than what it was before."

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Doud said the U.S. Will want to discuss access to Canada's dairy market. He also pointed to concerns that other countries, such as China, are unfairly benefitting from the trade deal by sending products into the U.S. Tariff-free through Mexico.

However, he gave no indication that the Trump administration really wants to abandon CUSMA.

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"I'm not going to get into that. You'll have to ask him," Doud said when asked why the president keeps disparaging CUSMA.

But should people be worried about the future of the agreement?

Doud paused for a few seconds before replying: "It's all a negotiation."

Correspondent

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