US Dairy Sector Accuses Canada of Flouting Trade Obligations in Letter to Trump

12 Jan 2017 --- Dairy organizations in the US have written to president-elect Donald Trump to spell out how Canada’s trade actions are hurting the dairy industry and driving down prices.

It’s all to do with Canada’s so-called “protectionist policies” which they claim are intentionally designed to block imports from America, according to International Dairy Foods Association (IDFA), National Milk Producers Federation (NMPF), the National Association of State Departments of Agriculture (NASDA) and the US Dairy Export Council (USDEC).

The groups have joined forces to tell president-elect Trump of their concerns and how Canada will soon expand its policies which they claim are in direct violation of the country’s trade commitments under the North American Free Trade Act (NAFTA) and the World Trade Organization.

In the letter they outline estimates from the US Department of Agriculture that show each US$1 billion of US dairy exports generates more than 20,000 jobs for American and almost US$3 of economic output.

And US dairy suppliers claim they are already losing business because of these programs, demonstrating that Canada’s actions are resulting in lost revenues and jobs for dairy farmers and processors across the US, particularly in Wisconsin and New York.

The US dairy industry is already restricted by Canada’s exorbitant tariffs, they said, and only limited market access is granted under NAFTA. Canada is one of America’s top trading partners, yet the country is clearly flouting its trade obligations by implementing and enforcing these policies, they said. 

“This negative impact is conservatively estimated at $150 million worth of ultra-filtered milk exports being lost by companies in Wisconsin and New York, which are highly reliant on their trade with Canada. In fact, the entire US dairy industry is being hurt, as milk prices are being driven down nationally by Canada’s trade actions,” the groups said. 

“Having an even wider impact on America’s dairy farmers and processors, additional large volumes of skim milk powder will be forced onto the thinly traded global market resulting in a further depression of prices that will negatively impact the revenues of dairy farmers around the world.” 

“The US dairy industry is highly competitive internationally, and overseas markets represent a vital source of future growth opportunities including thousands of new American jobs,” the groups said. “Not long ago, the United States was a net importer of dairy products, but now our nation benefits from a dairy trade surplus of over $2 billion. Enforcement of current trade agreements, whether bilateral or multilateral in nature, is central to strengthening the US economy.”