U.S.-EU Agricultural Collaboration and the Food to Jobs Pipeline

This is the third post in our weeklong blog series, Talking Trade: Stories of the Transatlantic Exchange.

By Jim Higgiston, Agricultural Minister Counselor at the U.S. Mission to the EU

I recently had the opportunity to speak with a group of agriculture students from the University of Illinois, who hoped to learn more about the agricultural trade relationship between the U.S. and the EU. I like to think they were fascinated by my briefing on the U.S. and EU agricultural systems and how they intersect, but as students preparing to enter the job market, I am sure they more anxiously awaited my answer to the question “What do you really do as a Foreign Agricultural Service Officer?”

Over the past 28 years, I agimage1have analyzed commodities, represented U.S. companies at trade shows, coordinated food aid, worked on agricultural trade agreements, … the list goes on. In reality, my mission is simple. I go to work every day to ensure that Americans can eat Belgian chocolate and drink French wine, and that Europeans have access to Alaska salmon and Starbuck’s Frappuccinos. In other words, my goal is to ensure that U.S. and EU agricultural markets are as open to each other as they possibly can be.

The vibrant U.S. – EU agricultural trade relationship is perhaps even more important to our economies than it is to our taste buds. Trade in agricultural goods between the U.S. and the EU amounted to over $30 billion in 2014, and has been a dependable lucrative force in both economies throughout recent history.

U.S. consumers have developed a taste for high-quality food products from Europe, leading to huge imports of European wine, cheese, and olive oil. In 2013 alone, Americans spent $1 billion (0.91€ billion) on European olive oil. The EU primarily imports bulk commodities from the United States, with tree nuts and soybeans making up the largest component of US agricultural exports to the EU.  Additionally, exports of high quality consumer-oriented products from the U.S. are on the rise.

agchart1

This dynamic trade relationship has been bolstered by several trade agreements, facilitated by the fact that the U.S. and the EU have the highest food safety standards in the world. As of 2012, certified organic products can be represented as such across the Atlantic, thanks to the U.S.-EU Organic Equivalency Arrangement  This arrangement succeeded in reducing the administrative burden of overseas trade for organic producers, a benefit that is particularly advantageous for small and medium sized businesses that did not previously have the administrative capacity to obtain organic certification overseas. Similarly, the U.S.-EC Wine Agreement of 2005 established the mutual acceptance of all existing US and EU winemaking processes and established processes for the acceptance of future production processes.

Though agriculture sectors make up less than 5% of total GDP in both the U.S. and the EU, the impact of agriculture on these economies extends far beyond this statistic. Many manufacturing sectors use agricultural inputs as raw materials, and spending on agricultural products makes up a large share of household spending (13% in the U.S. and 18% in the EU). In 2013, every dollar (0.91€) of agricultural exports stimulated another $1.22 (1.10€) in business activity in the United States.

agchart2

Moreover, agricultural trade has a strong positive influence on the labor market. Agricultural income in the EU has experienced faster growth over the past five years than any other sector.   In the U.S., overseas sales of agricultural products supported more than 1 million full-time American jobs, both on and off the farm. That means more higher-paying jobs for Europeans and Americans alike, including, I hope, the soon- to-be-employable students of the University of Illinois.

Join the conversation on twitter with #TalkingTrade

One thought on “U.S.-EU Agricultural Collaboration and the Food to Jobs Pipeline

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s