Global Dairy Groups Urge Challenge of Canadian Dairy Policy
September 12, 2016

Global Dairy Groups Urge Challenge of Canadian Dairy Policy

 |  By: Mike Opperman

Dairy organizations in the United States, Australia, the European Union, Mexico and New Zealand today issued a joint letter to their respective trade and agriculture officials, expressing indignation about Canada’s recent actions that affect trade policy.

The groups said Canada’s policies violate “international trade obligations, hold out the prospect of trade diversion with attendant global price-depressing impacts and are in conflict with the principles of free markets and fair and transparent trade.”

The U.S. groups, including the National Milk Producers Federation, the U.S. Dairy Export Council and the International Dairy Foods Association, oppose a Canadian Agreement in Principle recently concluded between Canada’s dairy producers and processors. The agreement, which is undergoing finalization and review in Canada, would provide an incentive to substitute Canadian dairy ingredients for imported dairy ingredients and would unfairly subsidize exports of Canadian dairy products. If ratified, the agreement would take effect November 1, 2016.

Earlier this month Sens. Tammy Baldwin (D., Wis.) and Chuck Schumer (D., N.Y.) sent a letter to U.S. Trade Representative Michael Froman and Ag Secretary Vilsack asking for an investigation of dairy import practices.

In addition to the three U.S. organizations, the other dairy groups are the Australian Dairy Industry Council, the European Dairy Association, the European Whey Products Association, the European Association of Dairy Trade, Mexico National Chamber of Industrial Milk and the Dairy Companies Association of New Zealand. Each of the dairy organizations asked officials in their respective countries to initiate a WTO dispute settlement proceeding to challenge the agreement once its details are announced.

In the letter sent jointly to Froman and to other government trade officials, the dairy organizations stated that the Agreement in Principle would breach Canada’s trade obligations under the World Trade Organization (WTO) and the North American Free Trade Agreement (NAFTA). They said it also would undermine the intent of the pending Trans-Pacific Partnership (TPP) and the EU-Canada Comprehensive Economic and Trade Agreement (CETA).

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