The potato industry is one of the most successful specialty crops in terms of growth in exports. These gains have been the product of careful trade negotiations and enforcement actions over many decades. Future trade policy should look to build on the history of strong growth of potato exports when considering any modifications to North American Free Trade Agreement (NAFTA), reestablishing previously-negotiated benefits under the Trans-Pacific Partnership (TPP), and negotiating of new bilateral or multilateral agreements.


Exports of U.S. potato products to the top 10 foreign markets comprised $1.41 billion in 2016. Frozen potatoes were the largest portion of this with $1 billion in exports, followed by potato chips with $199 million, dehydrated potato products at $186 million and $183 million worth of fresh potatoes.

In addition to the vital North American markets of Canada and Mexico, Asian markets, especially Japan, China, Korea and Taiwan, were top export destinations for potato products. In marketing year 2016, the U.S. exported fresh potatoes and processed potatoes to 106 foreign markets. U.S. potatoes have a reputation for high quality and are highly desired. Potato growing regions near west coast shipping lanes and the proximity to Mexico and Canada allow for strong transportation options for U.S. potato exports. U.S. potatoes are a U.S. agriculture export success story.


In the years ahead, U.S. potato exports face significant challenges. Potato exports are a highly competitive business. Canada, the European Union, Australia, New Zealand and even China compete with the U.S. for potato market share in export markets. Price drives many sourcing decisions. In addition to exchange rates, shipping charges, differing tariff rates and phytosanitary restrictions can significantly affect exports.

President Trump’s recent decision to withdraw the U.S. from TPP could impact U.S. exports in markets such as Japan and Vietnam if competitors sign free trade agreements with those countries and negotiate lower tariffs. These countries will continue to seek free trade agreements around the world to lower the prices of their products. With TPP off the table, initiating and completing bilateral agreements with key export markets, including Japan and Vietnam, are immediate priorities for the U.S. potato industry.

The information below shows the current tariffs in key Asian markets that are applied to potato imports for all trading partners not having preferential trade agreements:


Fry Tariff

Dehy Tariff































Competitor countries are currently working on a bilateral and regional basis to negotiate preferential trade agreements that would substantially lower these tariffs.

North American Free Trade Agreement (nafta)

If the U.S. withdrew from NAFTA, U.S. frozen potato exports to Mexico ($122 million export value) and dehy ($32 million export value) would immediately face Mexico’s Most Favored Nation tariff of 20 percent. U.S. fresh potatoes to Mexico ($37 million in export value) would face either a 50 percent or 70 percent tariff. Canadian processed potatoes would likely continue to enter duty-free. Over $150 million in export sales could be lost to Canada if the U.S. fails to either renegotiate a trilateral NAFTA agreement or complete a bilateral deal with Mexico.

NAFTA is more than 25 years old and modernizing it to include 21st century phytosanitary provisions and improved dispute resolution procedures could be valuable. But any new agreement must preserve or enhance the reductions in tariffs for potatoes and potato products incorporated into the current agreement.

Formal negotiations commenced in the fall and are currently beginning the seventh round of negotiations in Mexico City. It is unclear when the NAFTA negotiations may conclude. The negotiations have moved along at a slower pace than the administration envisioned resulting in continued pressure from the president to make good on his threat to withdraw. Secretary Perdue has continued to make his concerns about that action very clear, although USDA has also been advising the agriculture community to make contingency plans just in case.

Prior to the president’s statement, NPC sent him a letter outlining our priority of enhancing NAFTA for the potato industry. Mexico is the third largest export market for U.S. potato products. Most exports are processed potatoes, particularly fries. Frozen, dehy and fresh potatoes currently enter Mexico duty-free due to NAFTA.  

The actions during the Mexican trucking dispute foreshadow the potential impact of withdrawal from NAFTA. Following a successful WTO case in 2009-2010, Mexico was empowered to could impose a temporary 20 percent tariff on U.S. fries. The resulting drop in U.S. fry exports was $67.8 million, a 46 percent reduction that was replaced by Canadian fries, which still entered duty-free.

Specific to specialty crops, a coalition of import sensitive fruit and vegetable interests convinced the Trump administration to propose easing the anti-dumping process within NAFTA. Under the proposal, an entire nation’s commodity does not have to be substantially impacted by imports over the course of a year. Instead, a region of a country can petition for relief due to economic harm that occurs during a specific season. This proposal is viewed as potentially damaging to a number of U.S. agricultural export interests and resulted in Senator Jeff Flake (R-AZ) placing a “hold” upon the confirmation of Gregg Doud’s nomination to become U.S. Agriculture Ambassador at the Office of the Trade Representative. Senator Flake has since lifted that hold based upon assurances he received that this issue will not be allowed to compromise U.S. exports.

The agricultural trade coalition that focuses on NAFTA has been very vocal about the negative economic impact of withdrawing from the agreement. NPC is an active member of that coalition.

TRANS-PACIFIC PARTNERSHIP (TPP) The Obama administration completed the negotiations on the TPP, an Asian-Pacific regional free trade agreement with 11 other countries in the Pacific Rim. The TPP countries officially signed the agreement on February 3, 2016. The 11 countries are: Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam, Canada, Mexico and Japan.

The TPP was never brought before Congress for consideration and it was uncertain there were enough votes to support passage. Shortly after taking office, President Trump withdrew the U.S. from the TPP process ending the possibility that the U.S. would be a part of a finalized TPP. President Trump announced he intends to be active in negotiating bilateral trade deals and will not participate in broad multilateral deals.

With the withdrawal from TPP, tariffs on U.S. potato products will remain at their current levels: 8.5 percent for fries in Japan and 13 percent for Vietnam, and at 9 percent to 20 percent for dehy in Japan and 18 percent to 30 percent in Vietnam. Japan is the single largest fry export market with $291 million in annual U.S. sales in 2016. Vietnam is a growing market for U.S. fry exports with $8 million in sales in 2016.

In November 2017, at the Asia-Pacific Economic Cooperation (APEC) meeting in Vietnam the remaining TPP countries committed to finalize the TPP without the U.S. This means that once completed and implemented, Canadian (and Australian and New Zealand) fries will enjoy zero duties in Japan, while the U.S. will remain at 8.5 percent. A similar scenario is likely to occur in Vietnam.  

Individual members of the TPP are aggressively seeking other trade agreements. For example, Japan and the EU announced a free trade agreement on July 6, 2017, that is likely to eliminate the tariff on EU frozen potato products. The Trump administration has a stated goal of negotiating bilateral free trade agreements with both Japan and Vietnam, but to date, both countries have been reluctant to pursue such agreements. They are watching with interest the NAFTA renegotiation and determining whether a negotiation is in their best interests.

NPC will work with the trade officials in the Trump administration and Congress to make the case for continued negotiations to reach trade deals with the countries that provide the greatest opportunity to increase the exports of U.S. fresh, seed and processed potatoes.


In September 2017, it was announced that the Japanese market would reopen for chipping potatoes from Idaho. Japan had halted imports in 2006 due to the detection of PCN. Once the eradication program was fully effective, APHIS worked diligently with their Japanese counterparts and state officials to re-open the market. In December 2017, Secretary Sonny Perdue released a year-end recap of USDA 2017 achievements and called out the reentry of U.S. chipping potatoes from Idaho into Japan as one of USDA’s “significant trade victories.”

Updated March 20, 2018