Ship full of exports
November 2, 2016

From Dairy JAM: No TPP Will Put U.S. Dairy Behind

 |  By: Mike Opperman

The Trans Pacific Partnership (TPP) trade agreement, while widely endorsed by agriculture groups, has not met with the same level of support from non-ag audiences. Neither of the presidential candidates support the agreement, which points hopes toward passage during a lame duck session.

Producers only need to look at the recent uptick in milk prices to realize the importance of strong export markets. “The reality is that increasing dairy export sales is critical to our future,” says Jim Mulhern, president and CEO of the National Milk Producers Federation (NMPF). He says NMPF is committed to seeking every opportunity to grow the U.S. share of world dairy markets, but the battle they face is uphill.

Comments were part of the joint annual meeting between NMPF, Dairy Management Inc. and the United Dairy Industry Association this week.

Anticipating that a TPP agreement will not be ratified, and in order to prepare for the future, plan B solutions are being identified.

“If we don’t do anything, we’ll be falling behind,” says Shawna Morris, vice president of trade policy with the National Milk Producers Federation (NMPF). “If we don’t do something now it will be a long time before another opportunity arises.”

Morris says that if the TPP initiative is not passed, “we will be starting over.” The next administration, whoever that is, would look at how to adjust the proposed agreement to fit their own agenda. “Changing something that was already negotiated with eleven countries would be difficult and time consuming,” Morris says. “Hopefully a new administration wouldn’t change things that aren’t broken, like the dairy section.”

As witnessed by fluctuating global prices throughout 2016, market share is all important when it comes to exports. And exports have a direct impact on prices paid to US dairy farmers. “The loss of export share in world cheese markets contributed significantly to lower milk prices this year,” says Peter Vitaliano, vice president economic policy and market research with NMPF. Any adverse impact on US cheese and other product exports would put negative pressure on milk price recovery in 2017 and beyond, signifying the importance of TPP passage for all of agriculture.

“We will push to represent trade deals that represent a net positive for American dairy farmers as TPP does,” says Mulhern. Regardless of the TPP outcome, he says “we will work in close collaboration with the U.S. Dairy Export Council to expand the access we have in global dairy markets.”