As talk of revisions to the North American Free Trade Agreement continue, concern from the U.S. agricultural community over a potential NAFTA withdrawal has intensified.
A report released in November by the American Farm Bureau Federation notes that Mexico and Canada represent 30 percent of all U.S. agricultural exports and are two of the nation’s top three export markets.
Total withdrawal from NAFTA, the report notes, “would make U.S. farmers and ranchers less competitive in our top export markets—and could result in billions of dollars of agricultural products accumulating in inventories—further weakening the U.S. farm economy. The integration of the North American agricultural market that has occurred over the last quarter-century is at risk.”
The AFBF report, Importance of NAFTA to Agriculture in Each State for 2016, is available at fb.org/market-intel/importance-of-nafta-to-agriculture-in-each-state-for-2016. It uses data from U.S. Department of Agriculture’s Foreign Agricultural Service to estimate the share of total agricultural exports represented by the United States’ NAFTA partners.
In 2016 $38 billion in U.S. agricultural products were delivered to Canada and Mexico—$20.3 billion to Canada and $17.8 billion to Mexico. Through the end of September, the report notes “exports to Mexico are up 6 percent over year-ago levels, and total NAFTA exports are up 3 percent.”
Five percent of Virginia’s ag exports went to Mexico last year, and 11 percent went to Canada, the state’s No. 2 trading partner in 2016, between China and Switzerland. Virginia’s total 2016 ag exports were valued at $2.77 billion.
Virginia was one of 16 states whose shares of total agricultural exports to Canada and Mexico were less than 30 percent. The top five states in terms of percentage of ag exports to NAFTA partners were Vermont (80 percent), North Dakota (73 percent), South Dakota (73 percent), Delaware (71 percent) and Missouri (69 percent).
The top five states in terms of percentage of ag exports to Mexico were Missouri, New Mexico, South Dakota, Texas and Nebraska. For exports to Canada, the top five states were Delaware, Wyoming, Maine, Vermont and Michigan.
Wilmer Stoneman, director of commodity marketing for Virginia Farm Bureau Federation, said the report “underscores the importance of NAFTA to our economy and farmers in Virginia and across the nation. It’s important to remember that many Virginia crops and livestock are shipped to other states for further growth or processing before they reach the final consumer.
“Often they are shipped to Mexico and Canada for value-added processing and returned to U.S. consumers.”
The AFBF report cites a U.S. Chamber of Commerce estimate that nearly 13 million jobs nationwide depend on NAFTA—about 8 percent of the country’s labor force. Percentage estimates among the continental United States are all between 7 and 9 percent; Virginia’s is 7.9 percent.