ASA urges grower action in support of DR-CAFTA

The American Soybean Association (ASA) is encouraging all U.S. farmers and livestock producers to contact their Senators and Congressional Representative to express support for the United States-Dominican Republic-Central American Free Trade Agreement (DR-CAFTA).

Growers are urged to use ASA’s convenient online Legislative Action Center, which is available at, to send email or letters to their legislators.

The DR-CAFTA includes the United States and six Central American countries: Costa Rica, The Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua. These six countries represent a growing region of 45 million people that imported $264 million in U.S. soy product in 2003.

"DR-CAFTA countries are already a large and loyal market for U.S. soybean exports," said ASA President Neal Bredehoeft, a soybean producer from Alma, Mo. "This agreement will solidify our position as the preferred supplier of soybeans and soybean products to these Central American nations, and open new opportunities for exports of U.S. livestock products."

DR-CAFTA will immediately eliminate tariffs on all soybeans and soybean products with the exception of refined soybean oil, where the tariff will be phased out over 15 years in equal annual cuts. The agreement will also benefit U.S. livestock and poultry producers, who are the largest domestic customer for U.S. soybeans.

"The Senate Finance Committee, which has jurisdiction over trade agreements, has scheduled a ‘mock’ markup of DR-CAFTA for the week of June 13 to gauge whether the deal has garnered sufficient votes to move forward in the process," said ASA Washington Representative Anna Pavlova. "At this point, it’s unclear whether there are enough supporters of DR-CAFTA to ratify the treaty. Thus, it is particularly important for producers with Senators that serve on the Finance Committee to send an e-mail to them in support of DR-CAFTA and urge them to oppose any amendment to weaken the agreement."

Republicans on the Finance Committee include Chairman Chuck Grassley (Iowa), Orrin Hatch (Utah), Trent Lott (Miss.), Olympia Snowe (Me.) Jon Kyl (Ariz.), Craig Thomas (Wyo.), Rick Santorum (Pa.), Bill Frist (Tenn.), Gordon Smith (Ore.), Jim Bunning (Ky.) and Mike Crapo (Ida.).

Democrats are Ranking Member Max Baucus (Mont.), John Rockefeller IV (W.V.), Kent Conrad (ND), James Jeffords (VT), Jeff Bingaman (N.M.), John Kerry (Mass.), Blanche Lincoln (Ark.), Ron Wyden (Ore.) and Charles Schumer (N.Y.).

"It is important to note that the U.S. market already is very open to exports from DR-CAFTA countries, with over 99 percent of their agricultural exports already entering the United States duty free," Bredehoeft said. "This agreement will level the playing field for U.S. producers and give them the same access to Central American markets that Central American producers already enjoy in the U.S. market."

DR-CAFTA provides the U.S. with sizeable quotas for exporting pork duty-free. These quotas will increase each year until they are eliminated in year 15. In addition, significant sanitary and technical issues are being resolved. Likewise, tariffs and quotas on imports of U.S. poultry products will be eliminated over the term of the agreement. Tariffs on certain sensitive products will have a 15-year phase-out period with a growing in-tariff quota, while others will be eliminated immediately.

"Removing trade barriers between the U.S. and the DR-CAFTA countries will preserve and create export opportunities not only for U.S. soybean, pork and poultry producers, but all of U.S. agriculture," Bredehoeft said. "Economists have estimated that the agreement could boost U.S. agricultural exports by $1.5 billion when fully implemented."

DR-CAFTA will protect U.S. jobs by keeping domestic soybean crushing plants operating efficiently, since these countries account for 14 percent of U.S. soybean meal exports. Keeping these plants open also enhances farm income by improving local basis levels.

The farm state value of soybean production last year was $18 billion, the second largest crop produced in the United States. Additionally, soybeans and soy products are the United States’ leading agricultural export commodity, contributing positively to our balance of trade.

"DR-CAFTA will help protect this important market for U.S. soybean farmers by reducing existing tariffs," Bredehoeft said. "Our competitors in South America are trying to take this ‘backyard’ market away from us. DR-CAFTA will give U.S. soy a tariff preference, helping to ensure that U.S. farmers continue to supply these markets."

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