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May 2, 2017

Canada Ready to Renegotiate NAFTA

 |  By: Anna-Lisa Laca

Over the past two weeks, there has been strong discussion of renegotiating NAFTA following the milk crisis in Wisconsin, Minnesota and New York -- where around 70 farmers lost their markets due to trade issues with Canada. President Donald Trump used the situation as a catalyst to bring up NAFTA renegotiation during a mid-April rally in Wisconsin. According to Shaun Haney of (a Canadian farm publication), Canada is ready to do just that.

“This week, it feels like none of [the hot discussion and attention from President Trump] ever existed,” Haney told AgriTalk host Mike Adams on Tuesday. “I think Canada was a hot target last week, but I think cooler heads will prevail.”

Canadian officials continue the strategy of visiting with Congress and other elected officials to ensure “people on the ground” understand the importance of trade between Canada and the U.S., he said.

Two weeks ago, Canadian Ambassador David MacNaughton sent a letter to the governors of Wisconsin and New York asking the groups work together to find trade solutions that work for both countries.

“Canada wants to renegotiate,” Haney noted, adding that renegotiation could happen as early as this fall.

Historically, the American and Canadian agriculture industries have gotten along well, even working together on regulations like COOL.

“Dairy is the one issue really where Canada and the U.S. don’t see eye to eye,” Haney says. “If you look across the spectrum of all the other ag commodities, there’s really not disagreement.”

It does not appear as if Canada will back down from its current stance and change the milk pricing policy many U.S. industry leaders see as protectionist.

“Similar to U.S. sugar, every country has industries with domestic special treatment for one reason or another,” Haney said. “Canadian [dairy] feels very strongly that the system works for them.”

A good trading relationship is important to both countries, but it’s not likely Canada will back down and open the market.

“This is an issue where unless Maxime Bernier wins the conservative leadership race that’s happening this month and becomes prime minister in two years, I would expect Canada will hold firm on how they feel today,” Haney said.

Because 99% of the producers affected by the trade crisis in the northern states have already found a new home for their milk, Haney thinks some of the pressure has diffused and that the unfortunate situation was a means for Trump to speed up NAFTA discussions.

“I think it was an opportunity of convenience for the president to put the pedal down and apply some pressure to this NAFTA file,” he said. “Outside of the dairy issue, there’s a lot of things to work on.”