Trade pact with Mexico, Canada could boost wine, other ag products from Modesto area
Modesto-area business leaders welcomed Tuesday’s major progress toward a new trade agreement with Mexico and Canada.
The two nations are key markets for almonds, tomatoes, dairy and other farm products from the Northern San Joaquin Valley. Canada is especially important for wine.
The pact would replace the North American Free Trade Agreement of 1994, which President Donald Trump claims has harmed the U.S. economy. Democratic leaders said Tuesday that they would seek approval of the new agreement in Congress following assurances about labor and environmental standards.
The new pact, the U.S.-Mexico-Canada Agreement (USMCA), is positive news at a time of trade tensions with China, India and other markets.
“The fact that there’s movement here is a big win,” said Elaine Trevino, president and chief executive officer of the Almond Alliance of California, based in Modesto. The state grows about 80 percent of the world supply.
Canada is second only to the European Union for exports of farm products from California. Mexico is No. 5.
Canada’s top 5 purchases in 2017 were wine, strawberries, lettuce, tomatoes and almonds, according to the California Department of Food and Agriculture.
Mexico’s main purchase by far was dairy products, followed by table grapes, tomatoes, almonds and flowers/nursery products.
The new agreement would allow trade with Mexico and Canada to continue without the threat of tariffs, said Chris Indelicato, chief executive officer at Delicato Family Wines, just north of Manteca. It also has a specific clause increasing access to British Columbia retailers, he said.
“It would be a huge upside to the world, including the U.S., to get these trade agreements ironed out,” he said.
Delicato is part of a north valley wine industry that accounts for much of the U.S. volume. It also includes major players such as E.&J Gallo Winery, Bronco Wine Co. and The Wine Group.
The region also is the nation’s leading grower of processing tomatoes, turned at canneries into paste, sauce and other products. Like the dairy, wine and nut industries, these plants employ several thousand people.
The U.S. House of Representatives could vote on the deal before Congress adjourns for the year. The Senate would likely vote in January or February.
Rep. Josh Harder, D-Turlock, called the trade deal “a major victory for everyone involved,” especially dairy farmers struggling to stay in business.
“The final deal we came up with is leaps and bounds ahead of the original agreement in terms of labor protections and will stop jobs from being shipped overseas,” Harder said in a news release.
The agreement was the primary focus of Vice President Mike Pence when he visited Lemoore in July, touting it as an example of “free, fair and reciprocal trade deals that put American businesses first.”
“It’s a win for American farmers and a win for American businesses and workers,” Pence told a crowd of about 800 people at the farm of Doug and Julie Freitas. “It’s absolutely essential that we get the USMCA passed by Congress.”
Trump tweeted Tuesday that the pact “will be the best and most important trade deal ever made by the USA. Good for everybody – Farmers, Manufacturers, Energy, Unions – tremendous support. Importantly, we will finally end our Country’s worst Trade Deal, NAFTA!”
The Fresno Bee and The Associated Press contributed to this report.
