US soybean exporters face strong competition in the global marketplace. According to a USDA Foreign Agriculture Service report, Brazil in particular is experiencing a tremendous boom in soybean production and could dwarf US output within five years. With a greater supply of soybeans on the market, US soybean producers could lose a significant share of global export revenue.

Soybeans are the highest value US agricultural commodity export. The US soybean industry has strongly supported expanding international trade by reducing tariffs and eliminating other trade barriers to increase access and encourage demand for soy and livestock products.

One way Congress can give American soybean exporters a leg up on the competition is to approve and implement free trade agreements with key markets. A great place to start is Central America and the Dominican Republic, which annually imports 980,000 metric tons (MT) of US soybean products. The potential impact of the FTA on soybeans in particular is exemplary of the broader benefits of the agreement for US agriculture in general. Here’s why:

Central America and the Dominican Republic are already a large and loyal market for US soybean exports. The six DR-CAFTA countries are a growing region of 44 million people that in 2004 imported about $260 million of US soybean products. In fact, US soybean exports have annually captured about a 95% share of the region’s total soybean imports.

Improved market access

While US soybeans and meal currently enter the Dominican Republic, El Salvador and Honduras duty free, they still face WTO bound duty rates of up to 60% on the products. Meanwhile, Costa Rica, Guatemala and Nicaragua apply import tariffs of one to five percent. Guatemala also maintains tariff rate quotas (TRQs) within the WTO for soybeans and soybean meal with out-of-quota tariffs of 91% and 40%, respectively. Under DR-CAFTA US soybean and soybean meal exports gain preferential access as tariffs are immediately eliminated for the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua. In the case of Costa Rica, soybean tariffs are immediately eliminated, and soybean meal tariffs fall from five and six percent to zero over 15 years.

DR-CAFTA makes the improved access permanent

By locking in these benefits now, the agreement precludes member countries from shifting to the much higher bound tariff rates in the future. This locks in a competitive advantage for US soybean exporters by ensuring unhindered access to the region’s markets regardless of developments that might otherwise lead member countries to revert to higher bound rates. (Source: and