- Anti-drug Trade Deal
Pushing U.S. Asparagus Prices Down
- Industry wants asparagus excluded
from Andean Trade Preference Act
- By Karen Gentry
Associate Editor
- The U.S. asparagus industry has been collateral damage in The War on Drugs.
A trade agreement signed 10 years ago to help countries involved in drug production and trafficking expand into other alternative crops has turned some South American countries into a major asparagus exporters to the U.S. Michigan asparagus growers will see their processing price drop 14% this year because of the influx of cheap asparagus.
The Andean Trade Preference Act (ATPA) allows certain products from Bolivia, Columbia, Ecuador and Peru into the U.S. with no tariffs. After a decade, slightly lesser amounts of drugs are coming from these countries, but substantially more asparagus is coming out of Peru. That country enjoys favorable labor costs and the benefits of duty-free trade in the U.S. for asparagus and other commodities because of the ATPA.
Asparagus industry representatives are now trying to get asparagus excluded from ATPA if it is renewed as anticipated when it expires in December 2001.
Al Almy, legislative liaison with the Michigan Farm Bureau presented an update on the agreement to asparagus growers during the annual Oceana Asparagus Day on March 8 in Shelby, Mich. On March 28 and 29 a contingent of asparagus industry representatives visited Washington D.C. in a push to get asparagus excluded from the list of duty-free commodities on the ATPA, according to Sarah Black, national legislative council from the Michigan Farm Bureau.
The group included growers Dick Waslworth, Mears; and Rodney Winkel, Watervliet; processors Earl Peterson, from Peterson Farms Inc.; Ron Armstrong from Honeebear Canning; Perry DeKryger, from the Michigan Asparagus Advisory Board (MAAB) and Black, Ken Nye and Jerry Campbell from the Michigan Farm Bureau.
They visited some Michigan congressmen, both Michigan senators, Marcy Capture from Ohio who is on the Ag Appropriations Committee as well as members of the Senate Finance Committee and the House Ways & Means Subcommittee.
Although the Michigan Farm Bureau would like to see ATPA expire and not be renewed, because of the political climate, most believe it will be renewed.
Almy said a 1998 report stated that imports from the Andean countries could impact the cut flower and asparagus industries while the ATPA had only a slight effect on the eradication of drugs in those countries. Black said ATPA has had a devastating effect on the relatively small asparagus industry. Although Peru will not be happy if asparagus is excluded from ATPA, that country still has the advantage of lower labor costs, according to Black.
Since 1991 U.S. imports from Andean countries have increased from $5 billion to $9.8 billion in 1999, according to Almy. He said Peru is the largest producer and exporter of asparagus with imports from that country totaling $37 million in 1999. Peru ships an estimated five million pounds of frozen processed asparagus to the U.S., said Almy. The total U.S. frozen asparagus market is 10 million pounds. The U.S. also consumes 80% of the fresh asparagus that is produced in Peru.
“Imported product displaces domestic product,” Almy said. He said an estimated five million pounds of asparagus in Michigan was not harvested in 2000 because of imports from Peru.
Last August comments were requested concerning ATPA and 13 responses were received including comments from the American Farm Bureau Federation, Michigan Farm Bureau, the MAAB and the MACMA Asparagus Division. The groups all want that duty free treatment not be granted to products when a country is economically competitive.
“Our concern is that the asparagus industry in Peru is now a mature, well established industry, not a developing industry,” Almy said. The agreement if renewed would likely be for another 10 years. If ATPA is renewed, asparagus industry representatives also suggested a trigger mechanism - a safeguard mechanism to address “import surges of perishable agricultural commodities.” This formula would set a maximum limit on the amount of asparagus and other commodities that can be imported into the U.S.
Black urges asparagus growers to contact their legislators to help in the effort to get asparagus excluded from the list. She said ATPA will likely not be voted on until summer giving the asparagus industry time to have their message heard. She said it is up to Michigan congressmen to carry the banner.
Almy told growers to consider a broad effort to lobby Congress particularly Michigan Congressmen Dave Camp and Carl Levin who serve on the Ways and Means Committee.
“We ask for your support as this issue goes forward. It’s going to take a team effort to resolve it,” Almy said.
