Beltway Democrats and Republicans are both claiming victory over this week’s announced overhaul of the 25-year-old NAFTA trade agreement. Back home in Montana, farmers and ranchers are still sifting through the pact’s details with a fine-toothed comb.
2019 can’t end quickly enough for some Montana farmers. Just ask Lola Raska.
“It’s been a long year,” she says.
Raska is executive vice president of the Montana Grain Growers Association.
“We had good production in a lot of the state, but there were multiple pockets where they’ve had severe quality issues. There’s still grain standing in the field in some areas of Montana,” she says.
Between uncooperative weather, lousy commodity prices and a rollercoaster international trade environment, Montana ag needs a shot in the arm. Raska says the United States-Mexico-Canada Agreement, the successor to the long-vilified NAFTA trade accord, might just be that ticket.
“We’re very pleased with USMCA and think it needs to be passed by Congress as soon as possible so we can have some certainty,” she says.
Republican Congressman Greg Gianforte agrees. Montana’s lone representative in the U.S House describes USMCA as a big win for both the United States and Montana ag.
“Our grain growers rely on foreign markets. Eighty percent of the grain grown in Montana does goes outside Montana and outside the country. That’s why this USMCA with Canada and Mexico is so important. We do six times more business with Canada and Mexico than we do with China,” he says.
Gianforte says he personally hashed out a provision with U.S. Trade Representative Robert Lighthizer that could eventually reap big rewards for Montana grain.
“Any Montana grain going to Canada will now be graded according to Canadian domestic grain standards. Without this agreement any grain from Montana grain growers going to Canada gets graded as feed quality. Montana grain growers are not getting a fair price for their grain in Canada. USMCA fixes that,” he says.
The Grain Grower’s executive VP, Lola Raska, describes the provision as a "very optimistic first step," but one that doesn’t completely resolve the problem.
“USMCA says that if wheat is grown outside of (Canada), if it’s one of the varieties that’s registered in Canada then it will be graded on the same level as Canadian grown wheat. There’s still that criteria that it has to be a Canadian variety and that’s the next step that we have to work on,” she says.
In other words, there are currently only a handful of Montana wheat varieties registered in Canada, and those are worth a lot more to Montana farmers. Raska says expanding that list could be a lengthy and cumbersome process, but one worth the effort.
The updated trade pact received a generally warm response from the U.S. meat and poultry industries, but there are dissenting voices.
Steve Charter runs a cow-calf operation about 30 miles north of Billings and is a member of the Northern Plains Resource Council.
“The main thing we’ve been focusing on is mandatory country of origin labeling, that we call COOL,” he says.
The COOL provision requires meat labeling detailing where the animal was born, raised and slaughtered. Some American ranchers say its advantage is twofold: clarity to consumers while providing American cattle producers leverage to compete against the growing volume of cheaper imported beef and cattle from Canada and Mexico. Congress repealed the labeling provision almost five years ago.
Again, Montana rancher Steve Charter.
“And as far as we know that didn’t make it in, so we just think that trade agreement without that doesn’t really support American producers,” he says.
“I have an agricultural advisory committee that advises me on these things," he says. "I’ve had specific calls with all the producer organizations in the state. There isn’t consensus on what should be done with COOL. If the industry agrees, I’m happy to represent them but there isn’t one school of thought there.”
The House could vote on the new USMCA trade pact in the coming weeks but the deal isn't expected to be considered by the U.S Senate this year. Senate Majority Leader Mitch McConnell says it will likely be pushed off until after the impeachment trial of President Donald Trump.