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April 26, 2018

U.S. Dairy To Trump: Don’t Forget Us

 |  By: Anna-Lisa Laca

As the renegotiations of the North American Free Trade Agreement appear to be coming to an end without so much as a discussion in regards to U.S. access to Canadian dairy markets, dairy industry leaders and lawmakers alike are not happy.

According to Tom Vilsack, CEO of the U.S. Dairy Export Council and former U.S. Secretary of Agriculture, the Trump administration has been vocal about wanting to level the playing field between Canada and the U.S. on world powder markets.

“They want the Canadians to rectify [Class 7] and change it,” he told AgriTalk host Chip Flory on Thursday. “

In addition, dairy leaders want to ensure the Canadian market is more open in the past and in order for that to happen, these issues have to be included in the modernization of NAFTA, he said.

“Our concern is that these issues have not yet been broached been discussed within the negotiations and these negotiations appear to be coming to a head,” Vilsack explained. “So we're continuing to put pressure on the administration to continue to put pressure on the Canadians to change this in some way, shape or form.”

Vilsack said President Trump and Ambassador Lighthizer have both been clear in their intent to bring this issue to the Canadians, but as talks seem to be approaching the finish line, the industry is getting nervous.

“Our dairy farmers are facing dire economic conditions this year, and the Canadian pricing scheme and tariffs are curtailing much-needed markets for U.S. dairy products. NAFTA should not be concluded without securing provisions that curb Class 7 and any other trade-distorting pricing scheme to ensure that U.S. dairy products can compete fairly in Canada, as well as in other markets,” said Jim Mulhern, president and CEO of the National Milk Producers Federation. “It is time to for Canada to eliminate all dairy tariffs so we can have true free trade across North America for all commodities.”

Recently a group of 68 bipartisan lawmakers sent a letter to Ambassador Lighthizer asking him to ensure NAFTA 2.0 isn’t completed without addressing dairy issues.

“We commend the efforts of these congressmen for tackling Canada’s ever-expanding list of restrictive trade policies, which have had a negative impact on our U.S. dairy industry and the U.S. economy overall,” said Michael Dykes, D.V.M., president and CEO of the International Dairy Foods Association. “Canada’s Class 7 milk pricing policy, implemented 14 months ago, artificially lowers milk ingredient prices and incentivizes the substitution of domestic Canadian dairy ingredients for imported ingredients. It also promotes the dumping of Canadian proteins onto world markets at below-market prices.”