Food prices are rising again, based on recent USDA data for chicken and beef.
Ranking Member Angie Craig (D-MN-2) argued in favor of USMCA as a means to lower food costs. “Families are struggling to afford food due to tariffs,” she said, despite USMCA having no tariffs on food (minus tomatoes) and the Trump administration recently increasing TRQs for beef from Brazil and Argentina. “Getting rid of USMCA would hurt U.S. families,” she said.
The Chamber and Meat Institute witnesses were certain to agree.
“If we lose duty-free access and other USMCA benefits, food costs would rise,” said Herrington.
The Meat Institute, which represents the large beef and chicken exporters, highlighted the importance of duty free transfer of live animals across the border. American ranchers, in particular, are still replacing the herd. But importing more live cattle, a policy that has been halted due to screwworm in Mexico, is unlikely to entice American ranchers to raise more livestock.
“Without live cattle trade, we would see areas of the country not able to operate at full capacity,” said Michael Schumpp, Senior Director of International Affairs at the Meat Institute in Arlington, Virginia. [Testimony]
Then, speaking to his own book of business, said, “meat companies would struggle to have a stable supply of consistent animals to produce food. The most important thing for meat is to maintain USMCA as it is. If we make significant changes that would undermine the agreement, giving more access to China and Brazil. The way to turn around our agriculture deficit is to ensure long term USMCA.”
The rising cost of food is a concern, but most of that can be explained by the Mexico live cattle blockade in response to animal safety here, drought, and herd replenishment in both the U.S. and Canada. Chicken prices rose due to bird flu a few years ago, and are now recovering. Prices are rising in the aftermath of rising fuel costs, caused by the war with Iran. None of these matters can be resolved by more imports. The U.S. has increased imports of nearly every food item on a dinner plate and food prices have risen steadily at least since 2020.
Although Trump had commented on ending USMCA as-is after the House hearing, Craig said that ending the 1990s-era free trade agreement would be “catastrophic.”
CPA’s take on the future of the USMCA, as submitted in comments to the USTR in 2025, is that the trilateral deal should be turned into two bilateral agreements instead. That does not imply that commodities would face tariffs. But tariff rate quotas on certain specialty crops and beef would go far to allow those sectors some much needed breathing room to grow. Similar policies have been used by Canada for years. It would be wise to imitate those where necessary. Congress should borrow from Canada dairy, and our own sugar managed trade model to help specialty crops and ranchers.
“The House Agriculture Committee will ensure that the voices of ag producers are heard,” said Chairman Glenn Thompson (R-PA-15). Again, the focus is on market access first. “Legislating the farm bill, which doubled the market access program and the foreign market program, is good for producers and consumers. The ag trade deficit is projected to narrow to $29 billion in fiscal year 2026, which is still too high, but it is a recovery thanks to international trade agreements,” he said. “For this reason, USMCA is critical.”
House Agriculture Committee Supports USMCA
New Concerns Over Specialty Crops Could Change Their Tune
President Trump might be fine with upending the United States-Mexico-Canada Agreement (USMCA) ahead of the July 1 review deadline, but the House Agriculture Committee is not. Their June 10 hearing on USMCA showed near unanimous support for the agreement, with six witnesses representing farmer associations and multinational exporters, led by the Meat Institute and the U.S. Chamber of Commerce. The Chamber witness even threw in comments about removing Section 232 steel and aluminum tariffs as well.
“Republicans have long supported pinpointed tariffs if someone is treating us unfairly. We don’t support global tariffs,” said Rep. Don Bacon (R-NE-2). “Free trade is best for consumers.”
This view seems to have bipartisan support on the Committee. It’s all about market access and exports. “Strong and predictable export environments are critical for farmers and producers,” said Rep. Salud Carbajal (D-CA-24).
At many points during the Q&A session, members appeared to be speaking the language of the exporters. Despite threats of U.S. tariffs and retaliatory tariffs, mostly by Canada, ongoing restrictions of live cattle exports from Mexico due to phytosanitary concerns involving screwworm disease, the vast majority of food items traverse the borders of Mexico, U.S., and Canada duty free.
“Duty free trade has served us well, and the Chamber is clearly against Section 232 tariffs – especially aluminum – which are damaging to businesses and manufacturers, and food packaging,” Chamber witness Neil Herrington said. [Testimony]
This exchange simplifies the overall theme of the hearing: Committee members wanted more exports, which some thought would lower the agricultural trade deficit, and witnesses wanted to maintain market access.
Still, Committee members signaled that they were also interested in predictable trade policy. Tariff threats that led to retaliatory measures complicated business for agribusiness and farmer constituents even when the tariff threat was not against agricultural commodities.
There was only one stand-out on the Committee who expressed at least equal concern of protecting domestic producers from high import flows. Rep. Shontel Brown (D-OH-11) said the Committee should “make sure USMCA helps domestic food production instead of shipping production overseas. We should think about USMCA not just as a trade agreement, but also as a national security strategy.”
The July 1 USMCA review is a required joint check-in by the U.S., Mexico, and Canada on how the trade agreement is working, and it is also the point at which the three countries decide whether to extend the pact for another 16 years. If they do not all agree to extend it, the agreement stays in force for now but moves into annual reviews and could expire on July 1, 2036. The review exists to assess the trade agreement, gather proposals for changes, and give each country a formal chance to flag concerns about compliance or market access.
Mexico Overwhelming U.S. Specialty Crop Growers
On May 10, dozens of House members from both parties, including numerous members of the House Agriculture Committee, sent a letter to U.S. Trade Representative Jamieson Greer about American farmers being inundated with Mexican fruits and vegetables.
The letter did not recommend any solutions, but it sets the table for possible changes to USMCA agricultural policies.
From the letter:
Fresh fruit and vegetable imports from Mexico have increased by more than 550 percent since 2001, driven by fundamental cost and regulatory advantages. Mexican producers operate with significantly lower labor and production expenses — agricultural wages are about one-tenth of U.S. levels. Because labor accounts for roughly half of total production and harvest expenses in this industry, these disparities create a substantial competitive gap. Mexican farms also avoid many of the regulatory requirements imposed by U.S. agencies such as the U.S. Environmental Protection Agency and the U.S. Department of Labor, further reinforcing their cost of production advantage. Without measures to restore competitive balance, specialty crop production will increasingly move to foreign countries. We urge you to evaluate trade actions that can safeguard U.S. growers from unfair pressures from Mexico. This work is essential to maintaining U.S. competitiveness in the specialty crop sector and to ensuring Americans continue to have access to high-quality, domestically grown food — an issue fundamental to our national security.
Rep. Mark Messmer (R-IN-8) was one of the signatories of that letter. “Mexico has a similar growing season to Indiana, so Indiana farmers are forced to compete against Mexican produce which benefits from lower input costs. How can the USMCA protect American farmers from cheap Mexican specialty crops,” he asked witness Dave Puglia, President of the Western Growers Association in California [Testimony].
Puglia suggested enforcement and alignment of labor and environmental policies, a direction that is surely to lead to little to no changes at all as it would require constant monitoring of Mexican farms, and formal complaints to be filed which could take years to resolve.
He gave the example of the Tomato Suspension Agreement, a deal that required Mexico to only ship a certain volume of tomatoes. They breached it. And after years of complaints by American growers, that agreement was terminated last year with a 17 percent tariff imposed on Mexican tomatoes.
Puglia admitted that “extrajudicial actions can be painful, but going to USTR to address these specific issues is critical.”
Rep. Austin Scott (R-GA-8), another signatory of the Amb. Greer letter, asked Puglia for better suggestions. “Specialty crop growers are being negatively impacted by Mexican imports. We are for balanced trade, but dumping products on us during harvest time is damaging,” he said.
Puglia said specialty crop growers will all have their own problems. It’s not a unified concern, other than import penetration. To him, the end of the Tomato Suspension Agreement is the gold standard, despite the agreement being broken for at least 10 years.
Tariff Rate Quotas (TRQ) were not up for discussion here.
In fact, the only time that issue was raised was when Wisconsin Rep. Tony Wied (R-WI-8) said Canada’s TRQ for dairy products was wrought with mischief, insofar as they set the volume cap for duty free, but never come close to filling it with American imports.
Imports Will “Lower Food Prices”
Food prices are rising again, based on recent USDA data for chicken and beef.
Ranking Member Angie Craig (D-MN-2) argued in favor of USMCA as a means to lower food costs. “Families are struggling to afford food due to tariffs,” she said, despite USMCA having no tariffs on food (minus tomatoes) and the Trump administration recently increasing TRQs for beef from Brazil and Argentina. “Getting rid of USMCA would hurt U.S. families,” she said.
The Chamber and Meat Institute witnesses were certain to agree.
“If we lose duty-free access and other USMCA benefits, food costs would rise,” said Herrington.
The Meat Institute, which represents the large beef and chicken exporters, highlighted the importance of duty free transfer of live animals across the border. American ranchers, in particular, are still replacing the herd. But importing more live cattle, a policy that has been halted due to screwworm in Mexico, is unlikely to entice American ranchers to raise more livestock.
“Without live cattle trade, we would see areas of the country not able to operate at full capacity,” said Michael Schumpp, Senior Director of International Affairs at the Meat Institute in Arlington, Virginia. [Testimony]
Then, speaking to his own book of business, said, “meat companies would struggle to have a stable supply of consistent animals to produce food. The most important thing for meat is to maintain USMCA as it is. If we make significant changes that would undermine the agreement, giving more access to China and Brazil. The way to turn around our agriculture deficit is to ensure long term USMCA.”
The rising cost of food is a concern, but most of that can be explained by the Mexico live cattle blockade in response to animal safety here, drought, and herd replenishment in both the U.S. and Canada. Chicken prices rose due to bird flu a few years ago, and are now recovering. Prices are rising in the aftermath of rising fuel costs, caused by the war with Iran. None of these matters can be resolved by more imports. The U.S. has increased imports of nearly every food item on a dinner plate and food prices have risen steadily at least since 2020.
Although Trump had commented on ending USMCA as-is after the House hearing, Craig said that ending the 1990s-era free trade agreement would be “catastrophic.”
CPA’s take on the future of the USMCA, as submitted in comments to the USTR in 2025, is that the trilateral deal should be turned into two bilateral agreements instead. That does not imply that commodities would face tariffs. But tariff rate quotas on certain specialty crops and beef would go far to allow those sectors some much needed breathing room to grow. Similar policies have been used by Canada for years. It would be wise to imitate those where necessary. Congress should borrow from Canada dairy, and our own sugar managed trade model to help specialty crops and ranchers.
“The House Agriculture Committee will ensure that the voices of ag producers are heard,” said Chairman Glenn Thompson (R-PA-15). Again, the focus is on market access first. “Legislating the farm bill, which doubled the market access program and the foreign market program, is good for producers and consumers. The ag trade deficit is projected to narrow to $29 billion in fiscal year 2026, which is still too high, but it is a recovery thanks to international trade agreements,” he said. “For this reason, USMCA is critical.”
CPA Economics Team Intern Brett Batchelder contributed to this report.
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