June 4, 2018

Canada 'Moving Toward Flexibility' On Dairy Market Access

 |  By: Anna-Lisa Laca

Over the weekend Canada’s Prime Minister Justin Trudeau hinted to the possibility for the U.S. to have more access to Canadian dairy markets through the revised North American Free Trade Agreement.

When asked on “Meet The Press” what he thought the Trump Administration wanted from NAFTA 2.0 he said: "I think they want a better deal on their auto sector from Mexico, and I think they want more access on certain agriculture products like dairy to Canada. We're moving towards, you know, flexibility in those areas that I thought was very, very promising.”

That positive movement was halted on Thursday when Vice President Mike Pence asked for a five-year sunset clause to be included in the deal. 

“But the United States want a sunset clause in NAFTA, which makes no sense,” Trudeau said. “You don't sign a trade deal that automatically expires every five years." 

These are the kind of fits and starts Tom Vilsack, CEO of the U.S. Dairy Export Council and former U.S. Secretary of Agriculture alluded to Monday on AgriTalk. 

“Well, it fits and starts, obviously. And now with the establishment of tariffs, potentially tariffs, that complicates the situation a bit,” he said when asked his take on the current NAFTA situation. 

Like many commodity groups, Vilsack says the dairy industry is concerned about Mexico’s initial reaction to the steel tariffs. 

“They haven't finalized this decision, but they may assess retaliatory tariffs against some of our ag products, and maybe some of our cheese's,” he said. “We hope that doesn't happen. We're encouraging folks to stay at the negotiating table long enough to get an agreement.”

According to Vilsack, there’s “no question” NAFTA needs to be modernized.  

“We need to preserve what's working in Mexico, keep that market open, it’s our No. 1 market,” he told AgriTalk host Chip Flory. “But we clearly need to fix what's broken in Canada: Class 7, market access has to be expanded and this is the opportunity.”

NAFTA is incredibly important to the U.S. economy and the food and agriculture industry in the U.S., Vilsack said. 

“So, it's incredibly important that we get all of these negotiations right, and that we open up markets and not close them,” he said.  

When asked by Flory whether or not farmers can expect a successful NAFTA conclusion, Vilsack said: “Well, we have to. I don’t think there’s an alternative.”