A united front of dairy organizations in the United States is complaining bitterly about Canada’s protectionism.
They say Canada is not living up to commitments made in the trade agreement among Mexico, Canada and the U.S., and they want prompt action.
The U.S. Dairy Export Council (USDEC), National Milk Producers Federation (NMPF) and International Dairy Foods Association (IDFA) issued joint comments Monday detailing how they believe Canada is breaking the agreement.
Their chief complaint is that Canada is failing to allow all of the imports agreed to at lower tariff rates.
There are quotas on those imports which are highly-sought by importers because they can buy cheap from the U.S. and sell at higher prevailing Canadian-market prices.
But the quotas are not being filled and Krysta Harden, president and chief executive officer of the dairy export council said. “Canada needs to stop manipulating its dairy tariff-rate quotas (TRQ).
“Its actions have not only negatively impacted U.S. dairy farmers and manufacturers, but also constrained many Canadian companies from being able to make use of these new TRQs to expand their supply options,” she said.
The trade agreement “lays out clear requirements on TRQ procedures, and we urge the U.S. government to ensure full compliance by Canada with those commitments.”
One change they seek is ensuring that TRQs be made available without discrimination to all actors in Canada’s full dairy supply chain — including distributors, retailers, foodservice outlets, processors, etc.
In 2020, the United States exported almost $676 million in dairy products to Canada, well short of the gains estimated to occur under USMCA by the USTR in its 2019 report, the organizations said.
The details of TRQs are confusing because for some products they are calculated on a calendar year basis and for other products on a different 12-months time period.
The Canadian marketing boards conducted a vigorous lobby with Canadian government officials over the implementation of the granting of the TRQs.