Agriculture Equipment Sector

An Expert's View about Agricultural and Forestry Machinery in Colombia

Posted on: 25 May 2012

The agricultural equipment sector accounted for nearly $19 million in U.S. exports to Colombia over 2008-10 (average) or less than 1 percent of total U.S. industrial exports to Colombia.

The U.S.-Colombia Trade Promotion Agreement Opportunities for the U.S. Agriculture Equipment Sector The U.S.-Colombia Trade Promotion Agreement would provide signicant commercial opportunities for U.S. exporters: • Colombia is the 18th largest market for U.S. agriculture equipment exports. • Estimated duties paid on exports of U.S. agriculture equipment products to Colombia were over $1 million from 2008 to 2010. Tari elimination could allow U.S. rms to reinvest in technology and production improvements. • Approximately 97 percent of U.S. agriculture equipment exports to Colombia would receive duty-free treatment immediately upon implementation of the U.S.-Colombia Trade Promotion Agreement; Colombian agriculture equipment taris currently average 9.5 percent, ranging up to 15 percent. Agricultural Equipment Sector Overview U.S. Agriculture Equipment • The agricultural equipment sector accounted for nearly $19 Exports to Colombia Averaged million in U.S. exports to Colombia over 2008-10 (average) or less 1 than 1 percent of total U.S. industrial exports to Colombia. $18.9 Million • Top U.S. agricultural equipment exports to Colombia include tractors, harvesting machinery, and their parts. $25 • In 2009, U.S. production of agricultural equipment products was 2 $20 over $22 billion. $15 • The U.S. agricultural equipment sector employed over 56,000 3 workers in 2009. $10 $5 $0 Improved Market Access for U.S. Agricultural 2008 2009 2010 Equipment Exporters to Colombia • Colombian agricultural equipment taris currently average 9.5 percent, ranging from zero to 15 percent. • Approximately 97 percent of U.S. agricultural equipment exports to Colombia would receive duty-free treatment immediately All U.S. Agriculture Equipment 4 upon implementation of the trade agreement. Exports to Colombia Would be Duty- • Taris on the remaining 3 percent of U.S. agricultural equipment Free Within 5 Years exports would be eliminated in equal cuts over 5 years. 3% Key States Exporting to Colombia • Top U.S. states exporting agricultural equipment to Colombia include: Louisiana, Florida, Iowa, Wisconsin, Michigan, Illinois, Immediate 5 Pennsylvania, South Carolina, North Carolina, and Texas. 5 Years, Linear 97% 1 Global Trade Atlas. Calculation based on import data as reported by Colombia. The denition for agricultural equipment used in this report, unless otherwise cited, is based on Harmonized System (HS) Headings 8432, 8433, 8434, and 8701. 2 U.S. Department of Commerce, U.S. Census Bureau, NAICS 333111. Shipments used as a best available proxy for production. 3 U.S. Department of Labor, Bureau of Labor Statistics, NAICS 333111 (non-seasonally adjusted data). 4 Data based on three-year average for 2008-2010. 5 U.S. Department of Commerce, U.S. Census Bureau. In Millions USD Foreign Competition in Colombian Market EU Could Gain a Tari Advantage • Colombia signed trade agreements with both the EU and Canada in November, 2008. Additionally, Colombia has FTAs in force with In the Colombian Agriculture the rest of the Andean Community, Chile, Mexico, El Salvador, Equipment Market Guatemala, and Honduras. Colombia grants some preferential 12 access to MERCOSUR, CARICOM, Costa Rica, Nicaragua, and 10 Panama. 8 • Upon implementation of its agreement, EU agricultural equipment exporters would enjoy a 4.7 percent average tari 6 EU advantage over U.S. exports. However, if the U.S.-Colombia TPA US 4 is implemented at the same time, U.S. exports would have an MFN 6 2 immediate 1.6 percent average tari advantage over the EU. 0 Other Key Commitments by Colombia for the Agriculture Equipment Sector Intellectual Property Rights: The U.S.-Colombia Trade Promotion Agreement requires high levels of intellectual property protection and enforcement, consistent with U.S. and international standards, and will support the growth of trade in valuable digital and other intellectual property-based products. The Agreement will provide for enhanced protections for trademarks, copyrights, and patents, such as the implementation a Colombian electronic trademark application system and on-line database, prohibitions on the circumvention of technological protection measures used by copyright holders, as well as ensuring that the parties will provide robust patent and test data protection. Remanufactured Goods: Colombia will eliminate its prohibition on the importation of remanufactured goods upon entry into force of the Agreement. Most Colombian taris on remanufactured goods will be eliminated immediately upon entry into force of the agreement, while taris on a small number of remanufactured goods will phase out over ten years. 6 U.S. Department of Commerce calculations based on EU-Colombia FTA and U.S.-Colombia Trade Agreement tari commitments and Colombian 2010 Tari Schedule. Average Tari April 2011 The International Trade Administration - Your Global Business Partner The International Trade Administration (ITA) – a division of the U.S. Department of Commerce – strengthens the competitiveness of U.S. industry, promotes trade and investment, and ensures fair trade through the rigorous enforcement of our trade laws and agreements. ITA also utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. For more information on exporting to Colombia, please contact: • The ITA office of the U.S. Embassy in Colombia at office.bogota@trade.gov, or 011-571-275-2519, or by visiting our website http://www.export.gov/colombia. • The U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://www.export.gov/eac. For more information on the U.S.-Colombia Trade Promotion Agreement, please visit www.export.gov/fta/colombia and www.trade.gov/fta/colombia. For more information on industry-specific issues, please visit http://trade.gov/mas/index.asp.
Posted: 25 May 2012

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