Purdue study shows trade deal boosts affordability and food supply
A new study by Purdue University highlights how North American trade agreements, including the United States Mexico Canada Agreement (USMCA), have helped make food more affordable for American consumers. The study was released by the Corn Refiners Association in partnership with the Agriculture Coalition for USMCA.
The research shows that reduced tariffs under these agreements have lowered food prices for households in the United States. On average, families save about $700 per year, which equals nearly 7% of their total food spending. The study also explains that for every 1% drop in food tariffs, consumer food prices decreased by about 2.8% over a ten-year period.
However, the report warns that if USMCA did not exist, tariffs could rise by an average of 7.4%. This increase could remove the cost savings currently enjoyed by consumers within the next decade.
Along with lower prices, the agreement has improved food availability. It has allowed American consumers to access certain food products throughout the year, even when they are not in season in the United States. It has also expanded choices and supported markets for products like corn and wheat.
"Food affordability remains one of the top concerns for American families, and this study makes clear that USMCA is part of the solution," said John Bode, President and CEO of the Corn Refiners Association.
"By strengthening agricultural supply chains, expanding market access, and reducing unnecessary costs, USMCA has helped provide consumers with year-round access to a wider variety of affordable food products. As the joint review approaches, maintaining a strong USMCA is critical for U.S. households, farmers, food manufacturers, and rural communities," added Bode.
The report also notes that lower income households benefit the most from reduced food prices because they spend a larger share of their income on food. In addition, trade agreements have improved the efficiency and stability of agricultural supply chains across North America.
"USMCA supports consumers, producers, and strong North American food supply chains," said Bryan Goodman, a spokesperson for the Agricultural Coalition for USMCA. "Preserving this trilateral agreement is essential to keeping food affordable and supply chains strong across the United States, Mexico, and Canada."
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