disruptive change & trade agreements
TRANSCRIPT
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Disruptive Change & Trade Agreements
Carlo Dade, Director, Trade & Investment CentrePrairie Oat Growers Association, December 2018
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Warm up act….
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Arthur J.E. Child Foundation Endowment Fund at the Calgary Foundation
CN
Max Bell Foundation
The Mosaic Company
Port of Vancouver
Prince Rupert Port Authority
Government of Alberta
Government of Manitoba
2017-18 PatronsTrade & Investment Centre
Support for the West
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Opportunity
Opportunity and optimism
Optimism
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Western Canada
Plant protein
Changing trade architecture
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End of NAFTA
But first….
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2nd recent attempt to update of NAFTA1st – TPP Windows95 to Windows102nd – USMCA Windows95 to Windows98USMCA = Concessions to keep what we already have
NAFTA - USMCA
Wikipediae fair use image
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TariffsSaskatchewan
Saskatchewan top 10 merchandise exports to U.S, 2016
How Important was NAFTA?
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Mexico WTO tariffor
What US producers would pay
NAFTA tariffor
What Canadian producers would pay
U.S. top Ag exports to Mexico, 2017
ProductValue (USD 000,000)
Corn (excl. seed) 2,257,333$ 4Soybean, other 1,585,457$ 7.5Wheat (excl. seed and durum) 696,097$ 7.5Cotton 350,487$ 0Rice in husk 199,982$ 9Grain sorghum (excl. seed) 75,275$ 7.5
Other SK opportunities for market share in Mexico
Pulses Value (USD 000,000)
Mexico WTO tariff NAFTA tariff
Other kidney beans 34,420$ 33.8Black beans 29,119$ 10Lentils (excluding seed) 19,611$ 10Pinto beans 14,882$ 10Grt Nthrn Beans 4,383$ 10Peas 1,883$ 5Split peas 1,850$ 5Navy pea beans 1,839$ 33.8Beans 1,640$ 10
0
0
If NAFTA or USMCA ever becomes a bi-lateral CDN-MEX deal
For Ag, NAFTA most important to…US?
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NAFTA/USMCA is not everything
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Agriculture (not dairy)
Energy
Investor State Dispute
State-owned Enterprises (SOEs)
Business travel/visas
Intellectual Property
NAFTA – USMCA & the West
ZipZilchUnfortunately,
nothing
Same oldNada
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Trade fights with US NOT finished, NOT overContinuing workOur problems go deeper (steel tariffs?)…and will continue
⁻ long term
But still…..
NAFTA – USMCA Bottom Line
flikr
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Backward ForwardU.S. Canada
But still there is opportunity
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CPTPP modelling
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American selling to EU Canadian selling to EU American selling to
JPNCanadian selling to
JPN
Commodity Code WTO MFN CDN - CETA WTO MFN CDN-TPP
Wheat and Meslin 1001.99 95€/tonne 71€/tonne 9.8¥/kg TRQs
Durum 1001.19 148€/tonne 111€/tonne 9.8¥/kg TRQs
Oats 1004.90 89€/tonne 66€/tonne 0 0
Corn 1005.90 94€/tonne 0 50% or 12¥/kg
Malt 1107.10 150€/tonne 0 21.30¥/kg
Rolled Oats 1104.12 180€/tonne 0 0 0
Protein concentrates 2106.10.20 12.80% 0 12.50% 1.5%/yr ↓
Agreement advantage
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HS Code HS Code categorizationJapan (TPP Country Example)
WTO MFN (USA) TPP (Canada)
071310Peas dried
071310.01 solely for sowing by chemical treatment (for example, sterilisation, acceleration of germination) 0 0
071310.211 (1) Certified as seeds for sowing vegetables 6% 0
071310.221 ‐ small red beans, kidney beans, bambara beans, cow peas, other beans (Vigna spp., Phaseolus spp.), broad beans, pigeon peas and other dried leguminous vegetables
10% 0
071310.229 Other 354 yen/kg321. 82 yen/kg – year 1193.09 yen/kg – year 50 – year 11
071340.020 Lentils dried other than for sowing by chemical treatment 8.50% 0
100111.090 Durum wheat ‐ other 55 yen/kg 55 yen/kg
100191.011 Meslin 20% see CSQ‐JP7
Opportunity
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More, much more than tariffs
Chap 5. Customs Administration and Trade FacilitationChap 6. Trade RemediesChap 7. Sanitary and Phytosanitary Measures
• 16 pages• Article 7.5: Committee on Sanitary and Phytosanitary Measures• Article 7.8: Equivalence (of sanitary & phytosanitary measures)• Article 7.9: Science and Risk Analysis• Article 7.10: Audits• Article 7.11: Import Checks• Article 7.12: Certification• Article 7.13: Transparency• Article 7.14: Emergency Measures• Article 7.15: Cooperation• Article 7.16: Information Exchange• Article 7.17: Cooperative Technical Consultations • Article 7.18: Dispute Settlement
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Opportunity
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More opportunity
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Even more opportunity
Plant Protein Human
Consumption
Aquafeed
Rising protein demand
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Architecture = Opportunity
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Canada’s Time Split in Asia
Selling 土下座
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Thank youMerci