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Illinois farmers still holding out for U.S.-Canada trade deal

September 14, 2018

There’s still no deal between the U.S. and Illinois’ largest trading partner Canada, but a deal inked with Mexico has farmers in the Land of Lincoln feeling more optimistic.

After months of trade uncertainty after the administration’s scrapping of the North American Free Trade Agreement, President Donald Trump announced late last month a deal with Mexico.

Trump said last week in Montana he’s winning on trade.

“We have a deal we just made with Mexico that’s a fair deal,” Trump said. “It’s not that horrendous deal that was made years ago that should have been changed years ago.”

“The president has achieved important improvements in the agreement to enable our agricultural producers to be treated more fairly,” U.S. Department of Agriculture Secretary Sonny Perdue said in a statement last month. “This breakthrough demonstrates that the president’s common-sense strategy of holding trading partners accountable will produce results.”

Details on a trade deal with Mexico were released in late August. While it deals primarily with manufactured goods, there are no tariffs on the trade of farm goods between the two countries.

“The agreement specifically addresses agricultural biotechnology to keep up with 21st-century innovations,” Perdue said. “And we mutually pledge to work together with Mexico to reduce trade-distorting policies, increase transparency and ensure nondiscriminatory treatment in grading of agricultural products.”

The Ladage Farm owner Brent Ladage said it’s all about the bottom line for his farm in Auburn. Trade deals will help the bottom line.

“We export many crops, and without that, our prices go down,” Ladage said. “We have a good abundance of crops this year, we’re going to need to get rid of them.”

Mexico is Illinois’ second-largest trading partner, with Illinois having sent about $9.5 billion in goods. Among the top exports to Mexico outside of automotive parts is corn. Canada is Illinois’ single largest trading partner; it took in about $16 billion in exports from Illinois in 2016.

Trump said a deal with Canada is in the works.

“We’re negotiating with Canada,” Trump said. “We’ll see what happens.”

District 10 Illinois Farm Bureau board member Mark Reichert said the one-on-one deal with Mexico is a win for farmers and could be something Trump uses to push a pact with Canada.

“I don’t know if that was part of the president’s philosophy to maybe try to corner the Canadians a little bit to try to get on board, but we’re tickled that it’s a win for us,” Reichert said.

Overall, Illinois agriculture products exported to all trading partners in 2016 was $3.25 billion. China is Illinois’ third-largest trading partner. Trump said the administration still is working on a deal with China.

Agricultural goods were the No. 1 export from Illinois to China bringing in $1.8 billion.

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