A new report from the USDA Foreign Agricultural Service analyzes the impact of the U.S.-Colombia Trade Promotion agreement for U.S. grains and shows that rice was the top beneficiary in the grains category, with U.S. rice exports to Colombia up 5,000 percent last year.
In 2012, U.S. rice exports under the tariff rate quota (TRQ) totaled 79,000 MT (milled rice equivalent). This year, the TRQ is set at 83,000 MT. The agreement stipulates that imports of U.S. rice outside of the TRQ are subject to an 80 percent duty; however the report concludes that market conditions are favorable for rice imports and Colombia millers also imported rough/paddy rice paying the 80 percent tariff. Additionally, the TRQ increases 4 percent annually and lasts for 18 years, by which time Colombia's import duty on U.S. rice drops from 80 percent to zero.
The agreement also provides that proceeds generated from auctioning licenses to export under the TRQ will be split evenly between the U.S. and Colombian rice industries. The U.S. share of proceeds in 2012 totaled $3.2 million, funds used expressly to benefit rice-research in the six major rice-producing states.
Colombia has one of the highest per capita rice consumption rates in Latin America, at 90 pounds, according to the report. Consumption is expected to parallel population growth, with demand remaining steady.
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