Wed June 8, 2011

Trade Impasse Leaves Colorado Farmers in Limbo

Governor John Hickenlooper has made it a priority to increase exports of Colorado products. He’s even challenged his new Commissioner of Agriculture, John Salazar, to ramp up exports of farm goods by forty percent in the next four years.

"We believe, and the governor believes, that the state of Colorado, its ticket out of this recession is increasing agricultural exports," Salazar says.

But a stalemate in Congress over three long-pending free trade deals with Panama, Columbia and South Korea could hamper that effort. 

Growing Demand for Exports

If you want to see how Colorado will emerge from the so-called “Great Recession,” at least in Governor Hickenlooper’s eyes, take a trip to farm country; the vast, wind-swept eastern plains near the Kansas border.

"They’re getting pretty big right now," farmer Brett Rutledge says while tending to nearly a thousand hogs in his barn. They’ll soon be shipped out to a slaughtering facility in California.

Hog farmers like Rutledge have looked to expand in recent years because there’s a growing market overseas for Colorado-produced pork.  Almost overnight, South Korea has become the state’s fourth largest export market.

"As their demand increases, it’s going to say ‘okay, we want more pigs, how are you guys going to meet that demand,’" Rutledge says, "Well, we’re going to have to expand."

And in Rutledge’s mind, the lifting of tariffs on pork products coming into South Korea would make that even easier.

According to the National Pork Producers Council and a study by Iowa State University, a free trade deal with that country alone would mean American farmers could fetch an extra ten dollars a head for every pig.

A 'Level Playing Field'

In the nearby town of Yuma, some people think that would have a trickle-down effect on this corner of the state. This county’s largest employer just happens to be Murphy Brown; one of the country’s largest pork producers. 

"By having this free trade agreement in place and implemented, it just makes the playing field level," says Jose Rojas, the company's local operations manager, during a rare stop at his office off a busy highway.  

Rojas, who is also president of the Colorado Pork Producers Council, has a good pulse on the local pork industry because he spends most of his days inspecting operations across northeast Colorado.

Rojas says, simply put, more demand for pork abroad means more jobs at home.  Murphy Brown employs 180 people here, and local officials figure the free trade deals might add up to ten new jobs. 

That may not sound like a lot.  But then again Yuma County isn’t exactly metro Denver. The county's entire workforce is only 2,700 people, and most are tied to agriculture.

"Agriculture is king in Yuma County," says Pat Duran, executive director of the Yuma County Economic Development Corporation, a one-man shop run out of the back of a local bank. 

"If we improve one job or two jobs at a time, that’s a big improvement for us, and we’re happy to get it," Duran says.

Duran says farmers around here would have liked to have seen the three free trade deals ratified years ago.  South Korea’s has been before the sharply divided Congress since 2007.  There were concerns then that the agreements would lead to a loss in American jobs in other sectors. 

Union Opposition

Those concerns persist today in this still-shaky economy, especially among labor unions and some members of Congress.

"The term that’s used is called trade adjustment assistance," says Senator Mark Udall (D-Colorado).  

Udall, along with the White House, favors the trade deals but insists that legislation approving them be coupled with millions of dollars in aid to job-training assistance programs.  

The White House, and some lawmakers, including Colorado Senator Mark Udall, are insisting that legislation to implement the three trade deals must ALSO include millions of dollars in job training assistance programs.  

"We’ve long had trade adjustment assistance for workers who lose their jobs through no fault of their own, but because of a globalizing economy," Udall said. 

But some conservative members of Congress say that could doom the legislation, or at the very least delay things even further. 

Farmers in Limbo

All of this waiting is leading to a growing sense of anxiousness apparent in some corners of farming-dependent Yuma. 

This part of the state fared slightly better than most areas during the recession largely due to high commodity prices for crops.  But if the impasse continues in Washington, that could change.

Brett Rutledge worries hog farmers here stand to start losing out big to their foreign counterparts.

"If they get in their first and maybe Korea might play favors to their pork, versus ours and then there we are playing second fiddle again," Rutledge says.   

Canada, the European Union and even Australia are expected to formally implement free trade agreements with South Korea over the summer.