FREE TRADE BUILDS MARKETS: PERU IS A GREAT EXAMPLE!
Peru purchased enough U.S. corn to fill its entire duty-free quota this year by March 26. The quota was negotiated under the U.S. Peru trade promotion agreement (PTPA), which has been instrumental in boosting bilateral trade in food and agricultural products since it went into force on Feb 1, 2009.
In 2015, Peru filled its quota in just seven days, according to U.S. Grains Council Regional Director of the Western Hemisphere, Marri Carrow.
“The U.S.-Peru free trade agreement has helped maintain an advantage for U.S. corn in the Peruvian market,” said Carrow. “For four of the past seven years, the country has filled its duty-free quota for the U.S. commodity, and this year will make five of eight.”
As of March 26, Peru had imported more than 751,815 metric tons (29.6 million bushels) of U.S. corn. In all of the 2014/2015 marketing year, which ended Aug. 31, 2015, the country bought 2.4 million tons (94.5 million bushels) of the commodity.
Trade continues to be an extremely important market for Illinois corn. As farmers see prices below the cost of production and farming in the coming years seems bleak, opening up international markets to corn and meat is a very important way to buoy prices. The Trans-Pacific Partnership is a trade agreement already negotiated and just waiting for congressional approval!
Moving forward, the Council will continue to be engaged in Peru, in partnership the USDA Foreign Agricultural Service’s staff in Lima, to further expand U.S. corn exports. Among other activities, USGC staff will continue hosting face-to-face meetings with Peruvian clients to provide them with market information and demonstrate the advantages of U.S. corn and U.S. grain purchasing processes.
“This market and the United States both benefit from the comprehensive trade agreement we have in place. If further trade liberalization occurs on a global scale, U.S. farmers could potentially reap benefits, like they have found this year in Peru, on a larger scale,” Carrow said.