HOUSE AGRICULTURE COMMITTEE
HEARING ON USMCA
For questions on the note below, please contact the Delta Strategy Group team.
On June 10, the House Committee on Agriculture held a hearing entitled “Agricultural Perspectives on the Future of the USMCA.” The witnesses in the hearing were:
- Michael Lichte, Chief Insights and Optimization Officer, Dairy Farmers of America
- Kristen Sawin, Vice President, Government & Corporate Affairs, Weyerhaeuser on behalf of the National Alliance of Forest Owners
- Dave Puglia, President and Chief Executive Officer, Western Growers Association
- Jamie Beyer, ASA Director and Executive Committee Member, American Soybean Association,
- Michael Schumpp, Senior Director, International Affairs, Meat Institute
- Neil Herrington, Senior Vice President, Americas Program, U.S. Chamber of Commerce
Below is a summary of the hearing prepared by Delta Strategy Group, which includes several high-level takeaways, followed by summaries of opening statements and discussion.
KEY TAKEAWAYS
Importance of USMCA to U.S. Agriculture
- Mexico and Canada are the top two export destinations for U.S. agricultural products, collectively accounting for more than $59 billion in annual agricultural exports and roughly one-third of all U.S. agricultural exports.
- Since the USMCA took effect, agricultural exports to Canada and Mexico have grown 47 percent, compared to only 18 percent growth to the rest of the world.
- Removing USMCA tariff preferences could raise the food price index by 12 to 13 points above baseline within a decade, according to a May 2026 Purdue University study.
- Canadian and Mexican foreign direct investment (FDI) in the U.S. food industry totaled $17 billion in 2024, up more than 25 percent since the USMCA entered into force in 2020.
- The USMCA’s Sanitary and Phytosanitary (SPS) chapter, biotechnology provisions, technical barriers to trade disciplines, and dispute settlement mechanisms were cited by witnesses as critical structural achievements.
- All witnesses besides Sawin supported a full 16-year renewal of the USMCA without withdrawal or significant structural changes, with Beyer describing failure to renew as catastrophic for U.S. agriculture.
- Predictability and certainty were cited by witnesses and members across both parties as one of the USMCA’s fundamental values to U.S. agriculture.
Trade Tensions and Tariffs
- Chairman Thompson (R-PA) noted the agricultural trade deficit has already declined 42 percent from its record-setting $43.7 billion level, supported largely by renewed international trade agreements.
- Ranking Member Craig (D-MN) and several Democratic members expressed strong concern that the Trump administration’s tariff policies have damaged U.S. credibility as a reliable trading partner, raised input costs for farmers, and created an unpredictable business environment.
- Multiple witnesses discussed that preserving tariff-free North American trade should be a central objective of the USMCA review, warning that tariff disputes have already resulted in market-share losses, higher input costs, and damage to U.S. commercial relationships with Canada and Mexico.
- Multiple members and witnesses warned that markets lost to competitors during periods of trade disruption are extremely difficult to recover, citing the loss of U.S. soybean market share to Brazil in China as a cautionary example.
Brazil and China Competition
- Brazil was identified as one of the primary competitive threats to U.S. agricultural exports across multiple commodity sectors, particularly soybeans and beef. It was stated that Brazil’s soybean production cost advantage over U.S. producers is $200 per acre, leaving U.S. farmers with little margin for error in export markets.
- The U.S. lost $14.9 billion in soybean exports to China between March 2025 and February 2026 because of China’s retaliatory tariffs. China maintains a ten-percent residual tariff on all U.S. ag goods, including soybeans, rendering U.S. soybeans uncompetitive against South American origin beans in the Chinese private market.
- Herrington characterized the broader set of verbal trade agreements reached by the administration as too early to tell and urged formalizing them through Congress.
- China’s suspension of all U.S. log imports in March 2025, citing phytosanitary concerns, was characterized as a non-tariff trade barrier (NTB), with Canada’s log exports to China increasing 35 percent during the same period.
- The EU was identified as a competitive threat in dairy and meat, with New Zealand also cited as a major global dairy exporter. The EU has trade agreements granting preferential access to both Canada and Mexico for meat, poultry, and dairy products, and has pursued an aggressive global campaign to restrict common food and beverage names through geographical indications in trade negotiations.
- Multiple witnesses warned that if the U.S. withdraws from or significantly undermines the USMCA, Canada and Mexico would accelerate their trade relationships with China, Brazil, and the EU, and that market share lost to those competitors would be extremely difficult or impossible to recover.
Oilseeds and Grains
- Canada and Mexico accounted for $4 billion of total soy complex exports, with Mexico as the second largest soy market at $3.3 billion and China as the largest at $9.9 billion.
- The USMCA’s SPS chapter and biotechnology provisions were said to have been essential in preventing non-science-based trade barriers and enabling U.S. soybean varieties to move efficiently across North American markets without duplicative regulatory processes.
- ASA called for harmonization of grain inspection standards across USMCA parties to eliminate reinspection requirements at the U.S.-Mexico border, and for more effective alignment of maximum residue limits without undermining regulatory approval processes.
- The USMCA exemption preserving potash from tariff actions was cited as critical to keeping farm input costs manageable, particularly at a time when farmers are facing price increases across fertilizers, pesticides, seed, and machinery simultaneously.
Renewable Fuels and the Renewable Fuel Standard
- NAFO identified fixing the definition of woody biomass in the renewable fuel standard (RFS) to recognize forest-derived feedstocks as its top domestic legislative priority, noting it would create significant market demand for low-grade pulpwood, forest residuals, and mill waste at zero federal cost.
- The sustainable aviation fuel (SAF) and maritime biofuel markets were identified as near-term opportunities.
- Sawin warned that if the U.S. does not fix the RFS to recognize forest-derived feedstocks and move to capture the growing global SAF and biofuel markets, China will.
- Canada is the top export market for U.S. biomass-based diesel and purchases between thirty and fifty percent of all U.S. ethanol annually.
OPENING STATEMENTS
Chairman “GT” Thompson (R-PA)
USMCA has proven to be extremely beneficial not only for farmers, ranchers, foresters, and businesses, but also for U.S. consumers and the economy as a whole. For the U.S. forest products sector, Canada accounts for 39 percent of imports, and Mexico accounts for 24 percent of the export market. Canada and Mexico together accounted for $4 billion in exports in marketing year 2024 for the soybean industry. For businesses, the USMCA upgraded provisions on things like sanitary and phytosanitary measures to ensure that legitimate health and safety rules do not become disguised barriers to trade. Canada’s implementation has fallen short of its commitments on both TRQs and export disciplines. U.S. forest product manufacturers continue to struggle with the Chapter 10 binational panel review process. Reinforcing and building upon the USMCA’s labor requirements, biotechnology provisions, food safety standards, and registration approvals will be paramount.
Ranking Member Craig (D-MN)
U.S. farmers are facing the worst economic crisis since the 1980s. Inputs are up, prices are down, and markets have been decimated in many cases. They need trade certainty to help weather the storm. For the past year and a half, we have watched this administration destroy the U.S.’s reputation as a reliable trading partner. We have seen abuse of tariffs and an inconsistent approach to trade barriers, raising consumer prices and creating an unpredictable business environment. Amidst this economic uncertainty, family farmers have been able to largely turn to our allies to the north and south as reliable markets for our goods. By threatening to blow up the USMCA, the president and his administration are threatening the last source of trade certainty our farmers have. They are right to have concerns. President Trump has been unstable on trade. While the USMCA may not be perfect and there are improvements we should make, it is still vital for U.S. farmers, ranchers, foresters, and businesses. In our continued pursuit to feed, clothe, and fuel the world, Mexico and Canada remain our top agricultural trade partners. It is worrisome when the president calls the USMCA irrelevant. It is even more concerning that at a time when we should be working with our allies to lower costs for farmers and fight back the influence of China, the president announced a new ten-percent tariff on Canada, Mexico, and the EU. The timing could not be worse for more chaos. Our farm economy cannot take any more shocks to the system. We need to strengthen our relationships with allies, not undermine them.
Michael Lichte, Dairy Farmers of America
Exports are essential to the future of the U.S. dairy industry. Within the broader export picture, the USMCA remains the most important trade agreement for U.S. dairy. Mexico and Canada account for more than forty percent of U.S. dairy export value. For farmers, stable and reliable market access is foundational to their ability to operate and plan for the future. The USMCA is working well in Mexico. Mexico is the most important trading partner for the U.S. dairy industry, purchasing billions of dollars in U.S. dairy products each year that are used throughout manufacturing, retail, and food service channels. This relationship has been built over decades through strong partnerships between our industries and stands today as a clear example of how trade agreements can deliver mutual benefit when implemented effectively. It is critical that we preserve this success, including ensuring that emerging policy developments in Mexico, such as potential restrictions on commonly used dairy product names, do not undermine the growth we have achieved. The USMCA has not delivered the same level of results in Canada. While the agreement established new market access opportunities, those opportunities have not consistently translated into commercially meaningful outcomes for U.S. exporters. Canada’s administration of its tariff rate quota (TRQ) system has limited the usability of negotiated access. Canadian dairy pricing policies continue to create conditions that distort trade and undermine competitiveness for U.S. producers. For our farmer-owners, the outcome is clear: access that exists on paper is not consistently translating into real market opportunities. As the joint review moves forward, improving how these commitments function in practice will be essential to ensuring the agreement delivers real results for U.S. farmers. The USMCA remains one of the most important trade frameworks supporting the U.S. dairy industry and the rural communities we serve.
Kristen Sawin, Weyerhaeuser, on behalf of the National Alliance of Forest Owners (NAFO)
U.S. private working forests are among the most productive and sustainably managed in the world. Export markets are an important component of the overall economic picture for our sector. U.S. log and wood chip exports are concentrated markets, made more so by trade barriers recently put into place by China in 2025. Our primary trading partners are now Canada, Japan, and Vietnam, and given this concentration, we remain vulnerable to significant price deflation when any of these markets tighten. Looking at the USMCA, Canada is an importer of U.S. hardwood logs and chips and an exporter of softwood lumber and other products, while the U.S. exports finished lumber and other products to Mexico, representing about 24 percent of our domestic production. Good policy can help support the sector and improve market stability for our landowners. Energy markets: fixing the definition of woody biomass in the RFS, to ensure that low-value and residual wood qualify for energy markets is cost-free to the federal government and would provide an immediate uplift for landowners and mills across the U.S. Housing policy: housing starts drive lumber demand, and NAFO supports the House-passed 21st Century Road to Housing Act. Trade policy: fair and enforceable trade rules and the removal of unjustified foreign barriers are critical to supporting domestic manufacturing operations. The U.S. should be viewed as the wood basket to the world. We operate under the highest sustainability standards and have more timber than we can process domestically. Unfortunately, year-over-year data shows that we are reducing our exports rather than increasing them, and we would like to see that change.
Dave Puglia, Western Growers Association
Canada and Mexico rank first and second, in terms of U.S. fresh produce exports, and represent roughly two-thirds of all global U.S. fresh produce exports. Our three markets have been integrated for so long that many of our members speak about their sales into Canada and Mexico the same way they speak about sales within the U.S. While there may be some exceptions tied to trade adjudications or other specific cases, the general rule should be duty-free access for produce between our countries. Western Growers urges that the U.S. and its partners affirm that the USMCA’s framework and tools should be the primary vehicle for addressing trade issues among the signatory nations. We urge the administration to conclude this work quickly so that trade flows can normalize and trade tensions can abate. While some of our products were temporarily placed on Canadian retaliation lists last year, just as critically, the trade tension between our countries has resulted in Canadian consumers, and by extension Canadian retailers, looking to diversify away from U.S. produce. While Western Growers strongly supports maintaining a free trade agreement with our North American neighbors, we also believe improvements are needed to the USMCA. One of the biggest persistent disadvantages U.S. producers face when competing against imports is the disparity in labor costs and standards. There have been successful changes to Mexican labor law and positive results for certain sectors since the USMCA came into force. Nevertheless, barriers remain that prevent the USMCA’s full promise from being realized. Regarding bankruptcy protections: among the key challenges in perishable agricultural trade across North America is the issue of reciprocal, enforceable mechanisms to protect fresh produce growers against nonpayment. In the U.S., Congress provided a trust mechanism as part of the Perishable Agricultural Commodities Act (PACA), which grants fresh produce shippers first-priority creditor status in the event of a buyer bankruptcy. In 2024, Canada adopted a similar mechanism. In the USMCA review, Mexico should be asked to adopt a similar mechanism to provide equivalent protection for exporters of fresh perishable commodities. Such a tool would establish trilateral safeguards ensuring fair and secure trade across all three markets. The U.S. has the most rigorous food safety standards and inspection systems in the world. However, we do not see the same commitment south of the border. Because of concerns about foodborne illness, the U.S. government has increased inspections of domestic farms, and producers themselves have made significant private investments in enhanced food safety systems. Food safety compliance cannot stop at the border. The USMCA review presents an opportunity for the U.S. to ensure that food safety oversight and standards are as vigorous in Mexico as they are domestically. The USMCA should be continued, but with important changes to rebalance the state of play between our three countries.
Jamie Beyer, American Soybean Association
The U.S. soybean industry has a profound positive impact on the U.S. economy, with the entire soy value chain generating $124 billion in economic impact in 2025. The trade uncertainty plaguing our industry this marketing year highlights the importance of stable, long-term trade relationships for U.S. soybeans. Robust international trade is a top priority for ASA, and we work together with the U.S. Soybean Export Council (USSEC), and the World Initiative for Soy in Human Health (ASA-WISHH) to continue opening new global markets while maintaining long-term export customers. According to the Agricultural Coalition for USMCA, agricultural and seafood exports under the USMCA generated $149 billion in economic output, supporting nearly half a million U.S. jobs and $36 billion in U.S. wages. Since the USMCA was enacted, the value of agricultural exports to Canada and Mexico has increased by 47 percent, compared to only 18 percent for the rest of the world. For the U.S. soybean sector, the importance of the USMCA cannot be overstated. The USMCA has provided stability and predictability for integration of North American agricultural markets, especially through the guarantee of duty-free treatment for soy and soy products. In the last complete marketing year, Canada and Mexico accounted for $4 billion in exports, or just over 13 percent of total soy complex exports. In addition, Canada remains the top export market for biomass-based diesel, a key value-added market for U.S. soy. The USMCA upgraded NAFTA in several important ways, particularly by including a strengthened chapter on SPS measures, which builds on the rules already in place under the WTO’s SPS Agreement. The revised agreement also included a novel section on agricultural biotechnology that preempted disruptive trade barriers stemming from the use of genetically engineered traits. Both additions modernized the agreement for U.S. agriculture. A top priority in the five-year review of the USMCA is wholehearted preservation of the trilateral agreement, maintaining comprehensive duty-free access, the WTO-plus SPS chapter, and an effective dispute settlement mechanism. The USMCA is critical for the U.S. soybean sector and should be continued without creating disruption or additional uncertainty. There are minor adjustments the three parties could consider to better facilitate agricultural trade. These recommendations include setting maximum residue limits more effectively without undermining the effectiveness of regulatory approval processes, and harmonizing grain inspection across the three parties to minimize transportation delays and support more efficient agricultural shipping. These small improvements would benefit agricultural trade and prevent additional barriers. As soybean farmers continue to face a challenging economic landscape, failure to renew the USMCA would be catastrophic. Maintaining free, open, rules-based, and fair trade within North America is critical for the continued success of U.S. agriculture.
Michael Schumpp, Meat Institute
The USMCA has fostered an integrated North American meat industry, creating opportunities for U.S. meat exports to flourish worldwide and for U.S. agricultural producers, workers, and consumers to thrive. It is the world’s gold-standard trade agreement, eliminating most tariff and NTBs on U.S. meat and livestock products and yielding a predictable, transparent trade environment for U.S. businesses, rural and agricultural communities, and U.S. workers. Maintaining this robust U.S. meat trade with Canada and Mexico is crucial to reclaiming America’s agricultural trade surplus. Walking away from or significantly undermining the agreement would drive up the trade deficit, depress wages, spur increased processing capacity in Canada and Mexico to the detriment of U.S. agricultural producers, and raise costs for U.S. consumers. Canada and Mexico are also leading suppliers of livestock, beef, pork, and poultry products to the U.S., illustrating the dynamic and integrated nature of the North American meat and processing economy. Imported products from our USMCA partners contribute to the resilience of the U.S. food supply chain, complement rather than displace domestic production, and moderate inflationary pressures driven by strong demand. Renewing the USMCA is a national security imperative. The integrated supply chains across North America reduce dependence on adversarial countries for critical food and agricultural inputs and have made the U.S. less vulnerable to geopolitical disruptions that could threaten our economic and security interests, including our food supply. The USMCA prevents competitors and adversaries from siphoning off market share that U.S. farmers and ranchers have cultivated for decades. Thanks to the USMCA’s promotion of science-based trade, strong consultative and dispute settlement provisions, and enforceable commitments, the U.S. meat industry is not subject to excessive and unwarranted regulatory regimes. The USMCA ensures that within North America, U.S. exports and American farmers, ranchers, and businesses face the fewest regulatory barriers and enjoy the most unfettered access to the Canadian and Mexican markets. When issues arise, the agreement’s consultative provisions are well-designed to adjudicate disputes and, crucially, enforce decisions to ensure compliance.
Neil Herrington, U.S. Chamber of Commerce
Our North American neighbors are the source of critical imports essential to the competitiveness of U.S. industry and manufacturing, many of which are unavailable domestically at reasonable prices or in sufficient quantities. No sector embodies the success of the USMCA more than food and agriculture. Canada and Mexico are the destination for a full one-third of U.S. agricultural exports, totaling $59 billion annually. Canadian and Mexican FDI in the U.S. food sector totaled $17 billion in 2024, up more than 25 percent since the USMCA’s entry into force in 2020. Best-in-class SPS rules have helped ensure transparency, information sharing, and science-based decisions that serve U.S. food and agricultural interests in all three countries. Canada and the U.S. share deep intra-industry connections that support trade within sectors and products such as grains, feed, beef, and pork. Mexico and the U.S. enjoy a complementary trade relationship in which grains, oilseeds, and meat flow south, while vegetables and fruits that the U.S. does not produce in winter or in sufficient quantities flow north. As the joint review process advances, the Chamber’s priorities are as follows. Maintain and strengthen the trilateral rules of the USMCA that support jobs and enhance North American competitiveness. Provide certainty and confidence to investors and producers by completing a transparent, expeditious, and orderly joint review. Secure a renewed commitment to full compliance with the agreement and address areas where compliance falls short, including in agricultural sectors. Mexico is failing to meet its obligations regarding approvals for agricultural biotechnologies and food products. In imposing tariffs on Canada and Mexico, the U.S. is itself in violation of the USMCA’s core commitment to maintain tariff-free trade within North America. Section 232 tariffs on steel and aluminum have adversely impacted prices on products ranging from farm equipment to food and agricultural packaging. Reversing USMCA tariff preferences would increase food prices and place additional pressure on household budgets. The USMCA was truly a landmark agreement for U.S. agriculture, and its positive impact has yet to reach its full potential.
DISCUSSION
Importance of USMCA to U.S. Agriculture
Witnesses offered support for the USMCA and for its full 16-year renewal. Schumpp described the agreement as the world’s gold-standard trade agreement, crediting it with eliminating most tariff and NTBs on U.S. meat and livestock products and yielding a predictable, transparent trade environment for American businesses and rural communities. Herrington noted that U.S. manufacturers export more U.S. goods to Canada and Mexico than to the next 12 largest U.S. export markets combined, and that more than 13 million American jobs depend on trade with Canada and Mexico.
Herrington and Schumpp emphasized the USMCA’s role in preventing competitors and adversaries from siphoning off market share that U.S. farmers and ranchers have cultivated over decades. Schumpp noted that the EU already has trade agreements with both Canada and Mexico, granting preferential access for pork, beef, and poultry, and that preserving the USMCA is essential to preventing the EU from gaining a stronger foothold in North American markets. Herrington echoed this point, noting that Canada and Mexico are either negotiating with or have existing agreements with China, Brazil, and the EU, and that any U.S. withdrawal from the USMCA would accelerate those relationships at the expense of U.S. agriculture.
Multiple members across both parties cited sector-specific statistics from their states to underscore the agreement’s importance.
Witnesses and members from both parties cited predictability and certainty as one of the USMCA’s fundamental values for U.S. agriculture, with farmers making planting, equipment, and investment decisions months and years in advance, requiring stable, knowable rules of the road.
Trade Tensions and Tariffs
Representative Brown (D-OH) noted that the hearing had coincided with news reports suggesting the administration was threatening not to renew the USMCA, describing the situation as one that you cannot make up and calling the administration’s approach midnight diplomacy that upends markets every time the president posts online.
Multiple Democratic Representatives raised tariff-related concerns in their lines of questioning. Herrington noted that aluminum constitutes forty percent of the cost of canned goods packaging and that Canada supplies eighty percent of U.S. aluminum imports, making those tariffs directly harmful to agricultural and food processing supply chains. Herrington further stated that eighty percent of potash used by U.S. farmers comes from Canada via rail and that the preservation of USMCA-complying goods exemptions for potash has been critical to keeping farm input costs manageable.
Representative Figures (D-AL) described the tariff impact on Alabama farmers as billions of dollars of harm that nobody signed up for, and called on the Committee to develop a relief package for American agriculture.
Representative Bacon (R-NE), approaching the issue from a Republican perspective, noted that Republicans have historically supported targeted tariffs when a trading partner is treating the U.S. unfairly, but have not supported broad global tariffs since the 1930s, citing Milton Friedman and Adam Smith and arguing that free and fair trade is simply the best outcome for consumers. Schumpp and Beyer emphasized the critical importance of USMCA exemptions for complying meat, livestock, and agricultural products, with Schumpp recommending those exemptions be continued as they have been essential for farmers, ranchers, meat packers, and processors.
Herrington addressed the broader damage to the U.S.-Canada relationship, noting that Brand USA has been significantly damaged in Canada as a result of the administration’s rhetoric. He discussed how Canadian tourism to the U.S. is down, Canadian companies are canceling contracts with U.S. counterparts, and that convention and visitors bureau numbers from Canadian travelers are down across multiple congressional districts. Representative Bacon stated that he does not see where the administration’s slighting comments directed at Canada have gained the U.S. a single advantage.
Brazil and China Competition
Multiple members framed the USMCA renewal as inseparable from the broader question of whether American agriculture can maintain its global market position.
Ranking Member Craig (D-MN) asked Beyer whether soybean growers could withstand the cancellation of the USMCA given the market losses in China and the growth of Brazil and Argentina as competitors. Beyer responded that the USMCA is a shining star for the soybean industry precisely because, in contrast to the situation with China, where the industry is essentially maintaining quota levels, U.S. soy exports to Mexico have quadrupled and exports to Canada have doubled over the life of NAFTA and the USMCA. She described it as a big win and said the industry considers North American market growth a direct counterweight to the instability and unpredictability of the relationship with China.
Representative Taylor (R-OH) asked witnesses to address the hypothetical of where Canada and Mexico would turn if the USMCA went away, and Lichte responded that customers are always looking for the highest quality product they can afford, and that without the rail system advantages and long-term agreement stability the USMCA provides, those markets would be vulnerable to displacement. Herrington noted that Brazil has increased its beef exports to Mexico, where it is now the second largest beef supplier after the U.S., and that the EU has active trade agreements with Canada and Mexico granting preferential access for meat, poultry, and dairy. Schumpp added that the integrated nature of North American meat and livestock trade would be directly disrupted, with Canada and Mexico accelerating alternative trading relationships if the USMCA were undermined.
Representative Harris (R-NC) noted that China committed to purchasing $17 billion in U.S. soybeans annually through 2028 under the Busan agreement, but that Chinese purchases have nonetheless declined as China has turned to Brazil, and asked Beyer how the certainty and stability of the USMCA influences year-to-year planting and business decisions. Beyer responded that while the Busan commitment has not grown U.S. soybean exports to China as much as farmers had hoped, the USMCA relationship with Canada and Mexico has consistently grown over time, making it a much more positive and predictable relationship for planning and investment purposes.
Herrington addressed the competitive landscape in the Western Hemisphere more broadly in response to Representative Taylor’s question about future trade partners, identifying Argentina’s ongoing market-oriented reforms as a near-term opportunity and noting that twelve of the U.S.’s twenty free trade agreement partners are already in the Western Hemisphere. He characterized the verbal trade agreements reached by the administration as too early to tell in terms of impact, noting that they are mostly one to two months old, and urged that they be formalized through Congress.
Oilseeds and Grains
Representative Feenstra (R-IA) highlighted the importance of the USMCA’s SPS and biotechnology provisions for soybean farmers, and Beyer explained that U.S. soybean varieties take thirteen years from trait identification to farm deployment, keeping the pipeline roughly a decade old. She noted that the USMCA helps the industry capitalize on regulatory efficiencies between the three countries so that duplicative approval processes do not stack on top of one another, and that the agreement’s commitment to recognizing each country’s regulatory efforts and finding pathways for new technologies ensures that innovation does not get bogged down in politics or rhetoric. Representative Feenstra agreed that sharing information and ensuring it is factual and research-based are critical criteria for all three countries to embrace and expressed hope that the review would continue to advance that principle.
Representative Davids (D-KS) raised the input cost dimension of the USMCA for soybean farmers, asking Beyer to address how the agreement helps keep input prices lower and how its termination might exacerbate an already volatile and expensive input cost environment. Beyer responded that Brazil’s $200 per acre production cost advantage means U.S. soybean farmers are operating on the edge with very little margin for error, and that every trade agreement matters at that margin. She noted that her own fertilizer for soybeans comes directly from Canada, making the USMCA’s preservation of tariff-free potash imports a direct and personal financial issue, and described the current environment of double-digit increases across fertilizers, pesticides, seed, and machinery as compounding pressures that are accelerating simultaneously.
Representative Sorensen (D-IL) emphasized that the combination of the China tariff situation and potential disruption to the USMCA represents an existential threat to Midwestern grain farmers. He opened up the question of what termination of the USMCA would mean for the broader economy to the full panel, and Herrington responded that with a third of all U.S. agricultural exports going to Canada and Mexico, losing duty-free access would be potentially devastating, and that there is no short-term policy substitute that could replicate the savings and market access the agreement provides.
On grain inspection, Beyer called for harmonization of inspection standards across all three USMCA parties to eliminate the reinspection requirements at the U.S.-Mexico border that add a two-day delay and $70,000 in fumigation costs per shuttle train. Representative De La Cruz (R-TX) asked Beyer to elaborate on the specific challenges created by the absence of a grain inspection agreement with Mexico comparable to the existing U.S.-Canada agreement, and Beyer used the phytosanitary standards disparity on soil foreign material content as an example, noting that Mexico’s zero-tolerance standard versus the U.S. allowance of up to two percent for number two soybeans creates a frequent trigger for fumigation costs and delays that ultimately flow back to agricultural producers as reduced prices.
Renewable Fuels and the Renewable Fuel Standard
Sawin described fixing the definition of woody biomass in the RFS as NAFO’s top domestic legislative priority, explaining that the current definition excludes forest-derived biofuels from qualifying feedstock pathways despite woody biomass being a proven, carbon-beneficial, and domestically abundant renewable resource. She noted that recognizing woody biomass as a qualifying feedstock would create immediate demand for low-grade pulpwood, forest residuals, and mill waste that currently have very limited economic value, support forest management and reduce wildfire fuel loads, and provide rural forest communities with a stable revenue stream at zero federal cost.
On the SAF and maritime biofuel opportunity, Sawin stated that the window is open now and warned that if the U.S. does not fix the RFS to recognize forest-derived feedstocks and position itself to compete, China will capture that market first.
Beyer reinforced the renewable fuels dimension from the soybean perspective, noting that Canada remains the top export market for U.S. biomass-based diesel, making the USMCA a direct enabler of the renewable fuels trade relationship that supports value-added markets for U.S. soy.
Beyer noted in response to Representative Figures (D-AL) that domestic renewable fuel infrastructure, including access to crush facilities and fuel refineries, is increasingly important for local soybean markets and represents a domestic opportunity that complements the North American export relationships the USMCA supports.