Information regarding tariff rates and talk of trade wars have been pouring into the media cycle lately. With agriculture at the tip of the spear in this war, it is important to understand the complex trade policy decisions being made. This article is the first in a weekly series that will profile different commodities and the tariffs they face.
The United States has an estimated $59,500 gross domestic product per capita and an average most favored nation tariff rate of 5.2 percent for agricultural products. MFN tariffs are what countries promise to impose on imports from other members of the World Trade Organization unless the country is part of a preferential trade agreement (such as a free trade area or customs union).
In contrast, countries with a substantially lower GDP per capita, like India and Ghana, have a higher MFN tariff of 32.7 percent and 20.2 percent, respectively. One of our largest trading partners, China, maintains an average tariff on agricultural products of 15.2 percent. Another of our largest trading partners, the European Union, charges an average of 11.1 percent on agricultural products.
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