U.S. Dairy Producers Push Washington to Find Better Trade Terms
U.S. Dairy Producers Push Washington to Find Better Trade Terms
(Bloomberg) -- American dairy producers are renewing pressure on Washington to pursue trade deals that create “a more level and consistent global playing field” for the U.S. industry.
The U.S. Dairy Export Council and the National Milk Producers Federation jointly released a summary of trade barriers for review by the Office of the U.S. Trade Representative. They called on the incoming administration and policymakers to end trade practices that disadvantage American dairies and reiterated recommendations made in October for improving trade with more than 30 countries and regions.
“Exports are essential to the economic survival of our industry, and it is important U.S. trade negotiators fully understand all of the trade-distorting tricks used to keep high-quality U.S. dairy products out of global markets,” Tom Vilsack, president and chief executive officer of the dairy council, said in an accompanying statement.
The U.S., Mexico and Canada signed a key free trade agreement, known as USMCA, that went into effect in July, and final details that provide guidelines for dairy sales to Canada are to be solidified six months later. The U.S. industry groups said they’re particularly watchful that Canada holds up its end of the bargain. Canada and Mexico were among the top three buyers of U.S. dairy last year.
“Careful monitoring and enforcement of USMCA will be necessary to ensure the U.S. dairy industry is able to reap the full benefits of the progress it made to break down trade barriers,” the summary said. “Canada, in particular, has a long history of sustained efforts to undermine access to its market.”
Outside North America, the groups eyed Europe and China as priority markets to increase U.S. dairy access. Chinese retaliatory tariffs have trimmed the Asian nation’s purchases to the lowest in U.S. Dairy Export Council data dating to 2013.
In Europe, the concern is limited cheese-trade flows. The European Union said this week it would apply tariffs on American goods including cheese in retaliation over illegal aid to Boeing Co. Not enough American dairy products are exported to the EU for the new tariffs to affect production, but the levies are part of the ongoing “lop-sided Transatlantic trade dynamic,” Shawna Morris, vice president of trade policy at National Milk, said by email.
Income on dairy farms has been helped in recent years by increasing export demand. About $6 billion in American dairy products were exported in 2019, accounting for 15% of all U.S. dairy production, the industry groups said. Exports for the first nine months of this year were at the highest since 2014 when compared to the same period in prior years, according to U.S. export data.
The groups said they support free-trade talks with the U.K. and Kenya, where the U.S. is “competing head-to-head with major dairy exporters,” according to their October statement. It also “strongly urged” a focus on Southeast Asian markets such as Vietnam.
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