Agricultural News
How Important is the Phillippines for U.S. Agricultural Trade?
Thu, 11 Aug 2022 10:52:38 CDT
Last month (July 2022), the Foreign Agricultural Service of USDA led a trade mission to the Philippines that included representatives from nearly 30 agribusinesses and farm organizations and 10 state departments of agriculture. The primary purpose of the mission was to help expand agricultural trade, increase collaboration on key issues impacting agriculture in both countries, and strengthen Philippine food security. The trade mission highlights the importance of the Philippines for U.S. agriculture. In 2021, U.S. agricultural exports to the Philippines totaled $3.6 billion making it the 7th largest foreign destination for U.S. agriculture. Most of these exports were from the Western United States ($2.5 billion in 2021) primarily comprised of wheat, dairy, and soybean meal.
The Philippines is not as important for agricultural export sales in the U.S. South ($508 million in 2021) (See Table 1), ranking 31st among destination markets for the region. However, for certain agricultural commodities, the Philippines is very important (USDA, 2022). The major agricultural exports to the Philippines originating from southern states are reported in Figure 1. In 2021, poultry and related products were the leading agricultural export at more than $140 million. This was a significant increase above 2020 during the height of the pandemic. The next leading exports, soybean meal and pork, were valued at $132 million and $59 million, respectively. For all these products, the Philippines was the 7thlargest destination market for the U.S. South.
Although the Philippines is important for U.S. agricultural trade, there is no trade agreement between the two countries. While this trade mission was an important step in the right direction, MOUs and unofficial promises are not substitutes for official trade liberalization policy. The Philippines is a founding member of the Association of Southeast Asian Nations (ASEAN), which is a political and economic union of 10 member states in Southeast Asia that includes important U.S. trading partners like Vietnam, Indonesia, Singapore, and Thailand. Other than Singapore, the U.S. has no trade agreements with ASEAN countries. This is important because non-tariff barriers (NTM’s) in ASEAN have progressed slowly.
NTMs on agri-food trade in ASEAN’s priority sectors rose from 434 measures in 2000 to 1,192 measures in 2010 and to 2,181 measures in 2019, with sanitary and phytosanitary (SPS) measures making up the largest component of NTMs, accounting for about half of total measures (Suvannaphakdy and Kevin, 2021). Officially addressing these NTM’s could increase U.S. and regional agricultural exports to ASEAN countries including the Philippines.
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