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'It’s been a long time coming': New US trade deal expected to benefit Idaho agriculture

Industry experts believe the new trade agreement between the U.S., Mexico and Canada will help Idaho's agriculture, particularly dairy and wheat.

BOISE, Idaho — President Trump signed a new trade agreement on Wednesday known as the United States-Mexico-Canada Agreement, or USMC. 

The new deal replaces the North American Free Trade Agreement, which has been in place since 1994. Among other things, it promises to reduce trade restrictions on the U.S. and to better open markets for farmers. 

Nationally, USMC is projected to have a $68 million economic benefit.

KTVB spoke with experts from three of Idaho's top four agricultural sectors: dairy, potatoes and wheat. All three believe the new deal will be a positive thing for Idaho farmers. 

“I think this new negotiated deal is a very positive thing for the state of Idaho,” said Frank Muir, President and CEO of the Idaho Potato Commission.

When it comes to exports, Mexico and Canada are the top two recipients of Idaho agriculture products. 

According to recent research from the University of Idaho, approximately 20% of Idaho's ag exports are dairy, 14% are wheat, while another 37% are other crops, including potatoes. 

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Muir said one thing the new agreement does is eliminate potato tariffs imposed on the U.S. by Mexico. 

“So Mexico was actually shipping frozen products coming all the way from Canada and bypassing the U.S. for much of their products," he said. "So by eliminating the tariffs it gave us an even playing field and it’s really a positive day for Idaho potato farmers.”

Currently, frozen potato products can be shipped anywhere in Mexico from Idaho. However, fresh potatoes are only allowed to be shipped within the first 26 kilometers of the country. Muir is hopeful that USMC is a step forward toward changing that restriction too. 

Another crop expected to benefit from the change is Idaho wheat. 

Currently, Canada downgrades the crop to a lower classification, bringing in a lower price for U.S. wheat. USMC does away with that policy, meaning wheat farmers will see prices go back up. The deal also does away with wheat tariffs in Mexico. 

“This is a tremendous opportunity for us to be able to move wheat both directions – into Mexico and into Canada,” said Richard Durrant, a wheat producer and vice president of the Idaho Farm Bureau Federation. “As far as wheat alone, we estimate it’s going to be $1 billion a year in revenue to the U.S. producers for Idaho wheat.”

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USMC will also open more access to Canada for dairy farmers. 

“Dairy leads Idaho in total gross income,” said Bryan Searle, a farmer and president of the Idaho Farm Bureau Federation. 

Right now, dairy accounts for one-third of the state's total farm cash receipts. 

USMC also eliminates what's called the Class 7 milk system in Canada, which U.S. dairy leaders claim undercuts prices of some U.S. milk products sold there. 

“There’s different classes of milk and so it brings down some of those barriers which allows that trade to happen,” Searle said. 

Overall, he believes the Idaho dairy industry will benefit from the deal. 

“I’d just say there’s a great excitement throughout the state and the nation with this agreement. It’s been a long time coming,” he said. 

Under the new terms, Canada will also end its policy of not allowing imported wines to be sold. That is predicted by the U.S. wine industry to have a positive impact on national wineries, which could include Idaho.

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