ST. LOUIS, Dec. 4, 2007 (PRIME NEWSWIRE) -- The National Corn Growers Association (NCGA) applauds the Senate in its 77-18 passage today of the Peru Trade Promotion Agreement (PTPA). President Bush is expected to sign the agreement into law.
"Today's vote is a victory for the United States and Peru," said NCGA President Ron Litterer. "NCGA thanks the Senate for recognizing the importance of leveling the trade playing field with Peru. Corn growers nationwide look forward to the new export opportunities."
Last month, the House of Representatives approved the Peru Trade Promotion Agreement in a 285-132 vote.
The PTPA will eliminate barriers to goods and services and promote economic growth. The agreement also provides reciprocal access for American farmers and ranchers, as many of Peru's agricultural products have little or no tariffs upon entry into the U.S. through the Andean Trade Preference Act.
Under the Peru FTA (free trade agreement), corn growers can expect a penny per bushel increase in price which would amount to $100 million dollars on a 10 billion bushel crop. In addition, the increased demand in beef, pork and poultry converted into bushels of corn will likely mean another one-half cent. The Peru FTA also improves U.S. corn growers' ability to compete with regional competition such as Argentina.
Currently, Peruvian import duties on corn are bound at 30 percent, with an applied rate of 12 percent. Upon implementation, the FTA provides for immediate tariff elimination under a 500,000 metric tons (19.7 million bushels) corn tariff rate quota (TRQ); in year 10, the TRQ would be increased to 844,739 metric tons (33.2 million bushels); in year 12, the TRQ would be eliminated.
Peru is an important potential market for corn's value-added products, such as distiller's dried grains (DDGS). DDGS is currently bound at 0 percent. NCGA estimates that U.S. DDGS production will reach over 30 million tons by marketing year 2010-11.
NCGA is a member of the Agriculture Trade Coalition that supports the PTPA.
The National Corn Growers Association's mission is to create and increase opportunities for corn growers. NCGA represents more than 33,000 members and 48 affiliated state organizations and hundreds of thousands of growers who contribute to state checkoff programs. For more information on NCGA, log on to www.ncga.com.