US agricultural sales to increase by $8 bln following agreement with Japan

Donald Trump signed an executive order implementing a trade agreement with Japan. It is expected to increase U.S. agricultural exports by $8 billion a year. The White House called the deal historic.

The agreement lays the foundation for a new era in U.S.-Japan trade relations based on reciprocity and our shared national interests. It sets tariff frameworks that level the playing field for American producers, the White House website reported.

The Japanese government is working to accelerate its purchases of U.S. rice by 75%, as well as other agricultural products to the U.S., including:

• corn,
• soybeans,
• fertilizers,
• bioethanol (including for environmentally friendly aviation fuel),
• and other goods from the U.S., totaling $8 billion a year, the executive order said.

Under the agreement, the United States will apply a basic 15% tariff to almost all Japanese imports entering the United States. The new tariff system, coupled with expanded U.S. exports and investment-driven manufacturing, will help narrow the trade deficit with Japan.

Over the past five years, Japan has purchased just under $12.9 billion worth of U.S. agricultural products annually on average. In describing the agreement, the White House noted that “unlike any other agreement in American history, the Japanese government has agreed to invest $550 billion in the United States economy.”

The government expects these investments “to create hundreds of thousands of jobs in the United States, expand domestic manufacturing, and ensure American prosperity for generations to come.”

Tags: corn, rice, soybean, agricultural products, USA, fertilizers, Japan