Removing Tariffs from Trade

This post was originally published on this site

A particular tariff on one agricultural product in one country can send their average global tariff through the roof, as is the case with corn. South Korea imported one-third of all global corn shipped in 2014, but the country’s average corn tariff is 328%. So the average global tariff for corn is above 50% even though most of the world on average has a 5% tariff or less on corn.

Generally, poultry and pork — defined as other meats — have the second-highest average tariff at 17%, followed by oilseeds at 16%, which is also tied to high tariffs in South Korea.

Removing tariffs would increase consumer “well being” measured in income by about $56.3 billion. Consumers in the European Union ($10.8 billion) and Brazil ($8.8 billion) would benefit the most, though consumers in the U.S. would see a benefit of about $3.5 billion. Some areas would see higher costs and “experience a loss of welfare” including China at $1.9 billion in cost, Asia ($428 million) and Africa ($150 million).

The ERS study did not delve into details about retaliatory tariffs currently on U.S. agricultural products, such as the tariffs that remain on ag products to China.

USDA’s Foreign Agricultural Service released updated export numbers from January through April showing $59.2 billion in agricultural exports for the first four months of the year, up 26% from the same period in 2020.

Sales to China reached $10.7 billion, up 130% compared to $4.6 billion for the first four months of 2020. Soybeans accounted for $3.5 billion in sales, corn accounted for $1.6 billion, pork products reached $710 million and ethanol accounted for $134 million. https://apps.fas.usda.gov/…

ERS: How the Removal of Tariffs Would Impact Agricultural Trade https://www.ers.usda.gov/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN