There is a lot of talk these days about the dismal state of the rural economy. Low commodity prices, extreme weather and uncertainty in key foreign markets continue to plague agricultural producers across the country, including producers here in Illinois.
What hasn’t changed is the passion and commitment cattlemen and women have for their vocation. Cattle producers across the United States continue to produce the highest quality beef in the world. Our safety and inspection standards are consistent and proven.
We had a record year in exports even with the lack of secure trade agreements. This is made possible by both local and international promotion efforts and producers’ commitment to continuing to build demand for beef.
Fortunately, Congress has the power to help in these trying times. Ratifying the U.S.-Mexico-Canada Agreement would provide a much-needed boost to cattle producers, and it would benefit our rural communities that depend on exports to Canada and Mexico for economic success.
The USMCA was signed in November 2018, but all three countries must ratify the agreement in their legislative bodies before it can take effect. Lawmakers to our north and south have started to move in that direction.
Mexico passed a series of much-needed labor law reforms that were a condition of USMCA, and they have indicated their intent to ratify USMCA. Canada also has taken steps to introduce the USMCA in Parliament.
Yet here at home, we still are waiting on Congress to signal that it is ready to take action.
For cattle and beef producers, the benefits of moving forward with the agreement are clear. USMCA maintains duty-free, unrestricted access to Canada and Mexico — worth nearly $2 billion in sales annually.
But these top-line figures do not tell the whole story.
Trade with Canada and Mexico allows U.S. cattle and beef producers to maximize the value of each animal by selling specific products to the highest bidder. For example, Mexican consumers are willing to pay more for beef cuts that are less popular in the United States.
By exporting to Mexico, U.S. producers fetch a higher price for products like tripe, tongue and heart than they would get on the domestic market. No wonder we sold $240 million worth of these products to Mexico last year.
Open markets and science-based trade make all this possible. In fact, U.S. beef exports have flourished with zero tariff and non-tariff barriers on cattle and beef under the North American Free Trade Agreement. Exports to Canada have increased 106%, while exports to Mexico have increased 545%.
Without USMCA in place, cattlemen and other agricultural producers will continue to face massive uncertainty in two of our largest export markets.
Producers in Illinois will feel the consequences. Last year, our state directly exported $22 million worth of beef to Canada and Mexico.
And that does not count all the economic gains cattle producers in the state receive by selling their animals to other cattle feeders and processors who sell across North American borders.
Cattlemen need the USMCA to be approved fast. President Donald Trump has threatened to withdraw from NAFTA completely if USMCA does not move forward.
The consequences of such a move would be severe. High tariffs and unscientific trade restrictions would return to North America, causing further damage to the rural economy for years to come.
This doomsday scenario can be avoided, but only if our elected officials stand up for the USMCA. Our U.S. representatives and senators should be doing everything they can to get the USMCA across the finish line.
In closing, I am proud to have served the Illinois Beef Association as president these past two years. It has been a hectic, challenging and exciting ride.
As my term comes to a close, I reflect fondly on so many wonderful opportunities representing the IBA. I value the relationships I have built and the knowledge people have shared with me.
As cattle producers, we may not control our market, our input costs, the hours we work, or the weather, but we can’t contain our passion for our family farms. It’s our legacy and our heritage.
My hope is we can continue to be strong in telling our story and make sure our legislators and consumers understand the importance of what we do every day.