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Canada Dairy Industry: New NAFTA a Bad Outcome

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Dairy farmers in Canada “paid the price” to conclude an international trade agreement, according to Dairy Farmers of Canada. The recently announced U.S.-Mexico-Canada Free Trade Agreement that will replace the North American Free Trade Agreement includes allowing the U.S. expanded dairy market access. Canada’s dairy industry says the concessions show Canada is “willing to sacrifice our domestic dairy production when it comes time to make a deal.” The issue for Canada dairy farmers is deeper than the NAFTA renegotiation, however.

The USMCA follows two previous trade agreements in which access to the Canadian dairy market was granted, CETA, the EU-Canada Comprehensive Economic and Trade Agreement, and the CPTPP that replaced the Trans-Pacific Partnership sacrificed the equivalent of a quarter of a billion dollars annually in dairy production to other countries. The USMCA, according to the Canada dairy association, not only gives more access to the Canadian dairy market, but it also “lets the Americans dictate” Canada’s dairy policies. The organization says the livelihood of the thousands of Canadians and the future generations of dairy producers is seriously at risk due to the agreement.

With the North American Free Trade Agreement renegotiation effort complete, the Trump administration is expected to turn its trade attention to China and its neighbors. The Wall Street Journal says the U.S. should “follow this template” from the NAFTA talks to engage with Asia-Pacific trading partners and revive the dream of building a new, rules-based trading bloc to counter China. That was previously the goal of the Trans-Pacific Partnership that President Trump removed the U.S. from upon taking office.

The Wall Street Journal opinion piece suggests that the U.S. should follow suit in Asian trade markets as part of its goal of boxing out China. Trade talks are set to begin between the U.S. and Japan soon, marking a potential start on the region. The U.S. Grains Council has previously stated that Southeast Asia specifically represents a region of substantial potential growth for U.S. farmers.

The U.S. Cattlemen’s Association expressed disappointment that the deal does not include a viable pathway forward for country-of-origin labeling on U.S. beef products. U.S. Cattlemen’s Association President Kenny Graner says the organization is “disappointed that the Administration turned its backs on U.S. cattle producers.” The organization says the administration missed an opportunity to reestablish a viable country-of-origin labeling program for U.S. beef products.

In August, the association sent a letter to President Trump outlining how they believed a modernized NAFTA could reinstate COOL and “prevent U.S. agriculture jobs from being outsourced to other countries that can produce beef at a lower cost.” The association says in a statement that it will “continue to seek out avenues” for the return of COOL.

Source: NAFB News Service