Peru Picks Up Pace of U.S. Corn Imports

(World Grain) –  The U.S.-Peru Trade Promotion Agreement (TPA), which was implemented in 2009, is driving demand for U.S. corn, according to a May 15 report from the Foreign Agricultural Service of the U.S. Department of Agriculture.

In the report, the USDA said Peru’s imports of U.S. corn reached 1.5 million tonnes in the period spanning January-April 2017. Argentina also is a major corn supplier to Peru.

The TPA has been instrumental in the growth, the USDA said. The agreement provisions include a duty-free tariff-rate quota for U.S. corn and a tariff phase out period of 12 years. In 2017, the quota was 796,924 tonnes, and it was filled in early March, the USDA noted.

“Peru grants duty-free access to corn from all origins,” the USDA said. “However, it also imposes a variable levy under the Peruvian Price Band System. Imported U.S. corn receives a trade preference since the variable levy cannot be applied to U.S. in-quota corn. The levy can only be applied to U.S. out-of-quota corn imports, but not only to a level equal to Peru’s commitment under the agreement. In 2017, Peru’s TPA commitment for corn is 6.25%. The variable levy in 2017 has ranged from $37 to $48 per tonne. At current prices, out-of-quota U.S. corn can only be assessed $9 per tonne compared to $48 per tonne assessed on corn from other origins such as Argentina.”