Colombian small-scale farmers lose out in first year of trade agreement with US

By Oxfam America

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WASHINGTON, DC — Colombia’s small-scale farmers are getting the raw end of Colombia’s bilateral trade deal with the US a year into its implementation, according to research commissioned by international relief and development organization Oxfam.

In an ew study released today, Oxfam warned that of products important for Colombia’s small-scale producers, especially whey, rice, white corn, milk powder and pork, were at greatest risk of being undercut by an increase in US imports and a fall in import prices.

The study also highlighted that overall US imports into Colombia have grown at a much faster rate than Colombian exports in the other direction. This was particularly the case for agricultural commodities and processed foods.

“The Colombian government touted the benefits of increased access to the US market but the reality has not been so rosy,” said Adriana Rodríguez, Oxfam’s acting country director in Colombia. “Small-scale Colombian farmers are being forced to compete on an unequal footing with subsidized US products which is likely to lead to less income and falling local production.”

Colombia was motivated to sign the deal with the United States to consolidate the trade preferences it had enjoyed since 1991 as part of US illicit crop eradication policies. In exchange, Colombia accepted major concessions that may dramatically impact the livelihoods of small-scale farmers and affect the sustainability of development policies, according to Oxfam.

“Trade agreements between equals can benefit both parties by creating opportunities to access new markets,” said Stephanie Burgos, senior policy advisor with Oxfam. “But Colombia and the US are very unequal partners. This has led to an unfair trade agreement that delivers for large-scale subsidized US agricultural interests while hurting Colombia’s agricultural sector, in particular small-scale farmers.”

Rice is one of the most important staples in the Colombian family diet and vital to the country’s small-farm economy. According to Oxfam, the value of total rice imports increased almost eightfold in the first nine months of the trade agreement, while the import price fell by almost 85 percent, with the United States acquiring an 80 percent market share in Colombia.

Similarly, the agreement has allowed US dairy products to enter Colombia with prices more favorable than those of its competitors, significantly increasing US market share in Colombia for milk products, especially milk powder, from 1 percent in total imports to over 27 percent.

In the case of white corn, Colombian imports have increased by more than 60 percent, with the US displacing Brazil and Argentina. The US is now Colombia’s only external supplier.

Meanwhile, the value of pork imports from the United States has grown 37 percent since the implementation of the FTA.

“The consequences of this unequal trade agreement have been quick to materialize,” said Rodríguez. “We now urge the Colombian government to quickly adopt a monitoring system that enables timely action to mitigate the adverse effects of the trade agreement on small-scale farmers.”