California Ag Network

Tag: CAFTA-DR

  • Trade Agreements Strengthen Protections for U.S. Dairy Exports

    The National Milk Producers Federation, U.S. Dairy Export Council and Consortium for Common Food Names welcomed the United States’ signing of reciprocal trade agreements with El Salvador and Guatemala, underscoring the importance of reinforcing long-standing market access gains for U.S. dairy exporters and preventing the emergence of new trade barriers.

    As outlined in the agreements, El Salvador and Guatemala have both committed to address and prevent barriers to U.S. agricultural products, including dairy. These obligations include recognition of U.S. regulatory oversight and acceptance of currently agreed certificates issued by U.S. regulatory authorities, a prohibition on introducing a facility registration requirement for U.S. dairy products and streamlining of product registration requirements, which are critical elements for ensuring predictable and fair market access for all U.S. dairy exports.

    The two countries have also committed to ensuring that market access for U.S. agricultural exporters will not be restricted due to the use of certain cheese and meat terms. These include 38 widely used dairy terms such as parmesan, gruyere, feta and asiago, as well as 10 meat terms. This commitment provides important certainty for common name producers and exporters.

    “Securing durable market access and setting clear expectations with trading partners is essential for U.S. agriculture,” said Krysta Harden, president and CEO of USDEC. “This agreement builds on the success of CAFTA-DR and we thank the administration for fighting for the right of U.S. dairy exporters to compete fairly in the Salvadoran and Guatemalan market.”

    U.S. dairy exports already benefit from duty-free treatment in El Salvador and Guatemala as a result of the Central America–Dominican Republic Free Trade Agreement (CAFTA-DR). Tariffs on U.S. dairy products phased out entirely this past year, following direct advocacy from USDEC and NMPF over a decade ago to secure full market access under the agreement.

    “For dairy farmers, these agreements help to keep doors open to U.S. products,” said Gregg Doud, president and CEO of NMPF. “By protecting hard-won access and preventing new barriers from taking hold, the agreements support demand for U.S. milk and dairy products and strengthen the economic outlook for farm families across the country.”

    “As European authorities increasingly seek to confiscate common food names across Latin America, the agreements unequivocally protect 38 common cheese names and 10 generic meat terms and send a clear signal by preserving our producers’ right to label their products with terms that have been used for generations in El Salvador and Guatemala,” said Jaime Castaneda, executive director of CCFN.

    NMPF, USDEC and CCFN will continue working closely with USTR and U.S. government partners to monitor implementation of the agreement and to ensure that El Salvador and Guatemala fully meet their commitments to maintaining open and predictable access for U.S. dairy products and common name foods and beverages.

    The National Milk Producers Federation, based in Arlington, VA, develops and carries out policies that advance dairy producers and the cooperatives they own. NMPF’s member cooperatives produce more than two-thirds of U.S. milk, making NMPF dairy’s voice on Capitol Hill and with government agencies. For more, visit www.nmpf.org.

    The U.S. Dairy Export Council is a non-profit, independent membership organization that represents the global trade interests of U.S. dairy producers, proprietary processors and cooperatives, ingredient suppliers and export traders. Its mission is to enhance U.S. global competitiveness and assist the U.S. industry to increase its global dairy ingredient sales and exports of U.S. dairy products. For more, visit www.usdec.org.

    The Consortium for Common Food Names is an independent, international alliance whose goal is to work with leaders in agriculture, trade, and intellectual property rights to foster the adoption of high standards and model geographical indication guidelines throughout the world. Learn more at www.commonfoodnames.com.

  • California Citrus, Table Grapes & Dairy Well-Represented in Upcoming Trade Mission to Dominican Republic

    The U.S. Department of Agriculture will lead a high-impact trade mission to Santo Domingo, Dominican Republic, from July 13–17 to expand market access and boost U.S. agricultural exports. The delegation includes 47 agribusinesses, trade organizations, and officials from Colorado, Montana, and Wisconsin departments of agriculture.

    “USDA is committed to growing export opportunities for American farmers, ranchers and agribusinesses,” said Deputy Under Secretary for Trade and Foreign Agricultural Affairs Michelle Bekkering, who will lead the mission. “This trade mission will connect U.S. exporters with key buyers, tapping into Latin America’s growing demand for high-quality American agricultural products, supporting rural prosperity and keeping American agricultural products globally competitive.”

    With an expanding middle class, economic growth and a burgeoning hotel and restaurant industry, the Dominican Republic offers U.S. producers a stable and sustainable market in the Caribbean Basin. The country is the fourth-largest market for U.S. agricultural exports in the Western Hemisphere and the top market within the Central America Free Trade Agreement-Dominican Republic (CAFTA-DR) region, which includes Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua.

    Thanks to CAFTA-DR, U.S. exports to the Dominican Republic have increased from $800 million in 2007 to $2.2 billion in 2024, with the U.S. currently supplying 44 percent of the country’s agricultural imports, supporting around 15,000 American jobs. Between 2023 and 2024 alone, exports increased 6 percent.

    Participants will meet with buyers from the Dominican Republic, Haiti, and Jamaica to gain market insights and forge new partnerships. USDA’s Foreign Agricultural Service staff and regional experts will provide in-depth market briefings, site visits and networking events to maximize trade opportunities.

    Other participants include:

    1 Alaska Seafood Marketing Institute – Juneau, Alaska

    2 Boston Agrex LLC – Norwell, Mass.

    3 California Dairies – Visalia, Calif.

    4 California Table Grape Commission – Fresno, Calif.

    5 Colorado Department of Agriculture – Broomfield, Colo.

    6 Darigold Inc – Seattle, Wash.

    7 DoVen Foods LLC – Miami, Fla.

    8 Foodlink Group Inc. – Miami, Fla.

    9 Globex International – New York, N.Y.

    10 Grand Napa Vineyards – Napa, Calif.

    11 Hoogwegt U.S. Inc. – Lake Forest, Ill.

    12 IslandJon North America LLC – Atlanta, Ga.

    13 James Farrell & Co. – Bellevue, Wash.

    14 Lamex Agrifoods Inc. – Miami, Fla.

    15 Lawrence Wholesale LLC – Vernon, Calif.

    16 Leprino – Denver, Colo.

    17 Little Toad Creek LLC – Silver City, N.M.

    18 MacDonald Meat Company – Seattle, Wash.

    19 Merus LLC – Minneapolis, Minn.

    20 Metafoods LLC – Atlanta, Ga.

    21 Old Fashioned Cheese – Mayville, Wis.

    22 Pangea Growers Group – Boca Raton, Fla.

    23 Portal Pacific US – Rocklin, Calif.

    24 Prime International LLC – Logan, Utah

    25 Riceland – Stuttgart, Ark.

    26 Salt River Sisters – Harrodsburg, Ky.

    27 Scout & Zoe’s – Anderson, Ind.

    28 Scratch Food Group – Atlanta, Ga.

    29 SMAA Food Exports LLC – Charlotte, N.C.

    30 Stewco Farms – Bloomfield, Mo.

    31 Supreme Rice – Crowley, La.

    32 Sure Good Foods USA – Atlanta, Ga.

    33 Talmera USA Inc. – Los Angeles, Calif.

    34 Tropical Foods LLC – Miami, Fla.

    35 Trutana Foods – Great Falls, Mont.

    36 U.S. Dairy Export Council – Arlington, Va.

    37 U.S. Grains Council – Washington, D.C.

    38 U.S. Soybean Export Council – Chesterfield, Mo

    39 US Agricom Inc. – Doral, Fla.

    40 US Commodity Food Sales LLC– Doral, Fla.

    41 US Dry Bean Council – Frankenmuth, Mich.

    42 US Rice Producers Association – Katy, Texas

    43 USA Rice – Arlington, Va.

    44 Washington Apple Commission – Wenatchee, Wash.

    45 Western United States Agriculture Trade Association – Vancouver, Wash.

    46 Wisoman Foods Inc. – Hayward, Calif.

    47 Wonderful Citrus – Delano, Calif.

    USDA’s trade mission to the Dominican Republic is part of USDA’s broader 2025 export promotion strategy. So far this year, USDA has led trade missions to Hong Kong, Thailand, Peru, and Guatemala. Missions to Taiwan and Mexico are planned in the coming months.

    For more information on USDA trade missions, visit https://www.fas.usda.gov/topics/trade-missions.

  • Growth & Opportunities Ahead for U.S.-Dominican Republic Ag Trade

    The United States is a major trading partner with the Dominican Republic (DR). The DR is the largest economy in the Caribbean and the seventh-largest economy in Latin America. Since the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR) went into effect for the DR in 2007, U.S. agricultural exports to the DR have increased from $1 billion in 2007 to $2 billion in 2024. The schedule called for the elimination of all tariffs on U.S. exports to the DR as of January 1, 2025. Consumer-oriented products comprise the largest percentage of U.S. agricultural exports to the DR, with potential for further growth as the DR’s economy continues to expand.

    Macroeconomic Perspective

    The DR is the largest economy and the third-most-populous country in the Caribbean. The DR is the 14th-largest export destination for U.S. agricultural products, importing $2.2 billion in 2024, a 6-percent increase from 2023. Further stabilization of the economy from the COVID-19 pandemic will increase demand for imported agricultural products. The Economist Intelligence Unit highlights that the DR has experienced rapid growth during the past decade, with a projected real gross domestic product rise of 2 percent in 2024 and a forecast of 5 percent for 2025. The DR saw a 5-percent decrease in inflation in 2024, and experts forecast further declines.

    The DR has transitioned from an agriculture-dependent economy to a hybrid economy, bolstered by tourism, services, manufacturing, and telecommunications. Government support has spurred urbanization and expanded the middle class, according to the World Bank. According to the Central Intelligence Agency World Factbook, 84 percent of the DR’s 10.8 million inhabitants live in urban areas. These developments create favorable conditions for U.S. agricultural exports to the DR, supported by a growing middle class, a booming tourism sector, and an increasingly sophisticated retail food distribution system.

    Consumption Trends and Market Drivers

    Supermarkets account for only 25 percent of retail sales in the DR, with most consumers preferring traditional channels like colmados (neighborhood “mom and pop” convenience stores), public markets, and warehouses that focus on locally produced goods. However, internet and broadband infrastructure investments are paving the way for e-commerce, which is expected to grow 18 percent by 2027, according to Euromonitor.

    With lower- and middle-income consumers primarily using traditional purchasing channels, most U.S. agricultural exports target the hotel, restaurant, and institutional (HRI) sectors and the food processing industry. The Central Bank of the DR valued the country’s food processing industry at $3 billion as of September 2024, driven mainly by meat processing, wheat milling, bakery products, and dairy processing. The United States remains a significant supplier of meats, dairy products, and other key ingredients to this industry.

    The HRI sector is a key economic driver, with more than 11 million visitors in 2024, 53 percent of whom were U.S. passport holders, boosting demand for premium products like beef, pork, and craft beer. The Global Agriculture Information Network’s Food Service – HRI Annual provides more details.

    Prospects for U.S. Agricultural Exports

    Pork and Pork Products
    In 2024, U.S. exports of pork and pork products to the DR totaled $277 million, which tripled since 2020. The United States is the leading supplier of pork and pork products, with 85 percent of the total pork exports to the DR. Pork and pork products are the top agricultural export from the United States to the DR. Increased U.S. exports to the DR have continued to account for a major share of domestic consumption since 2022, following the impacts of African swine fever on domestic production as well as steady consumption growth.

    Dairy Products
    In 2024, U.S. exports of dairy products to the DR reached $135 million, a 47-percent increase since 2020, making the United States the second-largest dairy supplier after the European Union (EU), holding a 25-percent market share. The food processing industry uses U.S. dairy exports for ultra-pasteurized milk and confectioneries, while the HRI sector and retail outlets also favor them. According to the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS) Santo Domingo, variety and quality make U.S. cheeses competitive compared to domestically produced cheese. U.S. cheese has 38 percent of the market share compared to the EU’s 59 percent share. The full implementation of the CAFTA-DR should give the U.S. dairy industry a competitive advantage in relation to the EU.

    Beef and Beef Products
    In 2024, U.S. exports of beef and beef products to the DR totaled $120 million, quadrupling since 2020. The United States supplied 96 percent of the total beef and beef products exports to the DR. Geographic proximity and the demand for high-quality cuts, particularly in food service and retail, contribute to the rise in exports. Additionally, with U.S. passport holders making up more than 50 percent of visitors in 2024, there is a strong demand in the Dominican HRI sector to provide U.S. beef and beef products.

    Poultry and Poultry Products
    In 2024, U.S. exports of poultry and poultry products to the DR totaled $128 million, a 57-percent increase since 2020. This was primarily due to higher prices, with the United States supplying 74 percent of total poultry imports. Meat processors primarily use poultry, with rising demand in the HRI sector and retail and in use for meat processing. The influx of U.S. and Canadian visitors has led many restaurants and resorts to import U.S. poultry due to high quality and preference. Additionally, Dominicans are shifting to poultry due to increased prices in both beef and pork locally. The DR also primarily uses imported meat in meat processing.

    Baked Goods
    U.S. exports to the DR rose 10 percent between 2020 to $50.9 million in 2024 for bakery goods. Corn chips and frozen pastries lead the way. According to S&P Global, there is a growing popularity for less traditional options, such as baguettes, milk bread (bread made using milk instead of water), and croissants, especially in modern grocery outlets and e-commerce. There will be a rise in demand for nontraditional breads, especially breads that consumers consider healthier, such as whole-grain or multigrain products. With a growing youth population in the DR, there has been an upward trend in the consumption of snacks, particularly chips.

    Fresh Fruit
    U.S. exports of fresh fruit to the DR increased fourfold from 2020 to $51 million in 2024, making the United States the leading supplier with a 58-percent market share. Other top suppliers are Chile and Peru. The DR primarily imports apples, pears, and grapes. According to FAS Santo Domingo, the United States mostly exports apples, with a 91-percent share of the Dominican market. However, the United States is not the top exporter of pears or grapes to the DR. Chilean pears and Peruvian grapes account for 51 percent and 61 percent of their respective markets. The U.S. will phase out tariff rates on fresh fruit exports in 2025, while Chile and Peru will continue to face a 21-percent tariff rate on fresh fruit, creating an opportunity for U.S. exporters.

    Distilled Spirits
    U.S. distilled spirit exports to the DR rose 98 percent from 2020 to $32 million in 2024. The United Kingdom is the top supplier, with a 62-percent market share, while the United States has a 5-percent market share. Other top suppliers are the EU, Mexico, and Costa Rica. Euromonitor predicts a rising demand for distilled spirits due to economic stabilization and increased tourism. Demand for dark rums and whiskies, especially bourbons, is recovering to pre-pandemic levels, with potential growth in vodka and gin, as local consumers shift from white rum to a greater variety of distilled spirits.

    Trade Policy

    The CAFTA-DR Agreement includes the United States, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the DR. This agreement has liberalized trade, leading to a 126-percent increase in U.S. agricultural exports to the DR since the agreement entered into force for the DR in 2007. The CAFTA-DR Agreement scheduled for the elimination of all tariffs for U.S. exports by January 1, 2025. However, the DR has not phased out a tariff-rate quota for U.S. rice.

    As reported by the U.S. Department of Commerce’s International Trade Administration, the DR has joined free trade agreements with the Caribbean Community and the Caribbean Forum-European Community and has a preferential trade agreement with Panama. However, CAFTA-DR is the most significant agreement for the DR. With limited competition from other agreements and most tariffs on agricultural goods scheduled to be phased out by 2025, the United States maintains a competitive edge in the DR’s agricultural import market.

    Conclusion

    The DR is a key trading partner for the United States, being the largest in the Caribbean and the seventh-largest trading partner in Latin America. The full implementation of CAFTA-DR in 2025, along with a growing HRI sector and food processing industry, economic growth, and an expanding middle class, positions the United States as a top agricultural supplier in the coming years. There are opportunities for U.S. agricultural exports to expand, especially in meat products and healthy food options, such as whole-grain bread, fresh fruit, and vegetables.