Earlier this week, Colombia Rice Export Quota, Inc. (COL-RICE), the organization that manages the tariff rate quota (TRQ) for U.S. exports to Colombia released the results from their third and final 2022 auction for import certificates.
The 18,938 metric tons (MT) of quota was fully subscribed with an average price of $121.12 per MT, which is the highest price since January 2020. The certificates may only be used for rice shipped between October 15 and December 31, 2022.
The results of this auction are a positive end to the year for Colombia with all 122,685 MT of TRQ being utilized, following sales of just 6 percent of the overall TRQ tonnage available in 2021. With a record Colombian rice crop in 2021 and inflated food prices, demand last year in Colombia sank for the first time since the signing of the Colombia Trade Promotion Agreement (TPA) in 2012.
Since the signing of the TPA, the U.S. has had access to an annually increasing duty-free quota. Proceeds of the COL-RICE import certificate auctions are split between the U.S. and Colombian rice industries, and after the proceeds from this latest auction are distributed, nearly $90 million will have been contributed to rice research across the six rice-growing states.
For U.S. rice entering Colombia outside the quota, the duty decreases annually, from 80 percent at inception and down to 43 percent next year. The duty will eventually phase-out in 2030 and U.S. rice will be able to enter Colombia duty-free and without purchasing import certificates.
“We are encouraged to see the demand in Colombia come back after a particularly dismal year last year,” said Sarah Moran, USA Rice vice president for international. “We can credit it to strong promotions in the Colombian market and symbiotic relationships between U.S. exporters and Colombian millers that import U.S. paddy. We are hopeful that demand remains intact ahead of the January 2023 auction where about 70 percent of the annual TRQ is made available.”
Colombia ranks among one of the most significant markets for U.S. rice exports, with sales generally well in excess of 100,000 MT and $50 million in value.