Dairy products including milk, cheese, butter and yogurt displayed on white wood nevodka/iStock/Thinkstock

Canadian milk pricing scheme causes major disruptions in U.S. dairy

Dairy groups continue to make case for Trump to intervene in Canadian dairy trade disruptions.

The U.S. dairy sector and state agriculture officials continue to urge President Donald Trump to take immediate action against Canada’s repeated and escalating disregard for its trade obligations under the North American Free Trade Agreement.

Most recently, Canada implemented a new national pricing policy that blatantly blocks American dairy exports and will enable significant dumping of Canadian dairy products onto the world market, they said. As a result, dozens of dairy farmers in the Midwest recently learned that they must find new customers for their milk by May 1, which will cause considerable economic hardship and possibly force them to go out of business.

In a joint letter sent to the President, the International Dairy Foods Assn. (IDFA), the National Milk Producers Federation (NMPF), the U.S. Dairy Export Council (USDEC) and the National Association of State Departments of Agriculture (NASDA) urged the Trump Administration to tell Canada's Prime Minister Justin Trudeau to halt the new pricing policy and restore imports of the blocked U.S. products, specifically ultra-filtered milk. They also asked Trump to direct U.S. agencies to “examine a full range of tools that could be used immediately to impress upon Canada in a concrete way the importance of dependable two-way trade.”

“U.S. dairy exports support approximately 110,000 jobs across America, many of which are in farming and food manufacturing, as well as in supporting rural manufacturing and skilled farm service workers,” the organizations said in the letter. “However, for trade to yield its full potential and provide the maximum impact possible in supporting American jobs, our trading partners must hold up their end of the bargain as well.”

The dairy and agricultural groups noted in the letter that this issue highlights the importance of gaining prompt approval of Trump’s nominees for secretary of agriculture and U.S. Trade Representative.

“We appreciate your Administration’s work to date on this issue and ask you to send a very clear message that Canada should be one of America’s most reliable trading partners, but in the case of dairy, it has consistently chosen to pursue a disturbing and harmful path,” they said. “We stand ready to support your efforts to address this urgent dairy issue.”

Holding Canada to its dairy trade agreements has remained a strong focus for NMPF, USDEC, NASDA and IDFA over the last year. Earlier this year, a group of 17 dairy companies representing dairy farmers and processors from all over the U.S. asked governors in 25 states to urge Canadian policy-makers to halt the national implementation of the milk pricing system. NMPF, USDEC, IDFA and NASDA also raised the matter with Trump in January before he assumed office.

The American Soybean Assn. (ASA) also has called on its members to reach out to House offices to expand the number of representatives’ signatures on a letter to the USTR that is being circulated.

“This non-tariff barrier is particularly prohibitive and is resulting in a loss of contracts for U.S. dairy producers. The long-term effect of this policy will not only harm U.S. dairy producers but has implications for an array of U.S. agriculture industries, including soybeans,” ASA said in a statement to its members.

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