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Industry Happenings

 

June 15, 2017

 

US dairy lobby demands freer dairy trade as NAFTA renegotiation nears
 

In its latest request submitted to the US government ahead of the NAFTA renegotiation, the US dairy industry is pressing for a freer dairy trade and a reversal of recent Canadian rules on milk-based products, thestar.com reported. 
 
The renegotiation is set to begin in August this year.
 
The dairy lobby's 15-page letter had two main requests concerning Canada, specifically, a reversal of new rules on ultra-filtered milk products, and increased access to the Canadian market that exceeds the 3.25% offered in an early version of the Trans-Pacific Partnership.
 
While dairy is expected to be a contentious issue, the National Milk Producers Federation and the US Dairy Export Council perceived the NAFTA renegotiations as a 'final chance' to achieve liberalisation in dairy trade.

"We see NAFTA modernisation discussions as the last opportunity to address just that type of unfinished business in order to truly open up the North American market," a letter by both organisations stated.
 
Canada was accused of taking "additional steps" that obstruct imports in the past years, even though the country's stringent controls are already "highly restrictive".

In addition, the letter appears to be more concerned with filtered-milk. The milk by-product is permitted to be sold in Canada at lower prices. The letter also claimed Canadian producers gained from import controls, huge tariffs of more than 200% on foreign competition, and the ability to sell new products at non-supply-managed prices.
 
Canadian regulations are furthermore blamed for a loss of Canadian customers; in one development, some Wisconsin dairy farms plunged into crisis after a major processing plant decided to stop buying milk from those suppliers.
 
Although Canadian industry rules were seen as a less consequential factor in the incident, with most of Wisconsin farms having found available markets with the help of the state government, those had not stop US President Donald Trump from slamming the Canadian regulations as "very unfair". 
 
However, Canada's dairy lobby asserted that the rule changes apply only to domestic markets and are legal under international trade law.
 
"The Canadian dairy industry is confident that the . . . (rule) respects our trade obligations. We are also confident that the Canadian government is going to protect its dairy industry," said Isabelle Bouchard of Dairy Farmers of Canada.
 
Canadian dairy farmers also shot back that Canadian regulations are unfairly targeted by the US dairy lobby for allegedly causing big problems.
 
Peter Hardin, a long-time editor of a Wisconsin dairy-trade publication, stated that the glut of US milk production is the real issue.
 

- thestar.com

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