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Potato tariffs lifted with new trade agreements

Herald Staff Writer | Hagadone News Network | UPDATED 13 years AGO
by Herald Staff WriterLynne Lynch
| October 18, 2011 6:15 AM

MOSES LAKE - Tariffs between 18 to 20 percent on U.S. frozen potato exports headed to Korea, Colombia and Panama were recently lifted.

The changes are part of new free trade agreements approved by Congress, according to information provided by the Moses Lake-based Washington State Potato Commission.

"Washington state growers and processors have endured these tariffs for 31 grueling months - costing millions of dollars and a devastating loss of market share that will be difficult to get back," said Congressman Doc Hastings, R-Fourth District. "In June the tariffs on apples, pears, cherries, apricots and potatoes were cut in half, and today's news means that these tariffs will be eliminated completely."

"Although long overdue, I want to applaud all stakeholders for their hard work to end these job-killing tariffs while keeping our roads safe."

The tariff eliminations return millions of dollars to the U.S. potato industry annually.

With Korea alone, the U.S. exported about $47 million worth of frozen potato product, according to Matt Harris, the commission's director of trade.

Now an 18 percent tariff for U.S. potato exports bound for Korea is gone. Korea is the fastest-growing market for U.S. frozen potatoes, according to information provided by the National Potato Council.

"It means our exports can grow because Korea has had a high tariff on our potatoes, said Frank Martinez, a potato commissioner from Royal City. "We've been waiting for those foreign trade agreements to be passed for the past two years."

He said the tariff eliminations will be "great" for U.S. exports, as the U.S. potato industry will be able to compete with Europe, Australia and Canada.

For example, the European Union (EU) signed an agreement to remove their 18 percent tariff with Korea. The EU's agreement began July 1.

Canada and Colombia signed a Free Trade Agreement as well.

Martinez grows potatoes for French fries for Simplot, McCain and Lamb Weston.

"It's going to be great for us," he commented.

Harris, of the commission, said they have been working on the issue for several years. Harris recalled the Korean Free Trade Agreement was being discussed in general terms about four years ago.

"We've been monitoring the issue ever since and examining how each free trade deal impacts the industry and our growers," he said.

He credited the state's Congressional delegation for their efforts, as they ensured the agreements supported business, agriculture and fair labor interests.

The new agreements between the foreign countries helps level the playing field for the U.S. potato industry between other countries without tariffs, he explained.

Eighty-seven percent of the state's roughly 9 billion pounds of potato production are processed into French fries, chipped or dehydrated potato products.

Harris stated the agreements "will go a long way" in supporting industry sales and related jobs.

According to Washington State University's potato economic impact study, 23,500 direct and indirect jobs result from the potato industry. The industry provides more than $4.6 billion to the state's economy.

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