U.S. dairy organizations and the state departments of agriculture across the country told President-elect Donald Trump that Canada’s existing and soon-to-be-expanded protectionist policies are intentionally designed to block imports from the United States. These policies are in direct violation of Canada’s trade commitments under the North American Free Trade Act (NAFTA) and the World Trade Organization, said IDFA, NMPF, NASDA and USDEC in a letter urging the president-elect and his key cabinet members to take immediate action.
The letter to Trump outlined estimates from the U.S. Department of Agriculture that show each $1 billion of U.S. dairy exports generates more than 20,000 jobs for Americans and almost $3 billion of economic output. U.S. dairy suppliers are reporting that 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 United States.
“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 U.S. 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 letter sent to Trump was signed by the International Dairy Foods Association (IDFA), the National Milk Producers Federation (NMPF), the U.S. Dairy Export Council (USDEC) and the National Association of State Departments of Agriculture (NASDA).
Canada is Flouting Trade Obligations
The U.S. 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.
“The U.S. 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 U.S. economy.”
Copied on the letter were several Cabinet nominees, including Robert Lighthizer, the Trump Administration’s nominee for U.S. Trade Representative, along with the leaders and members of the House and Senate agricultural committees. Read the letter here.