Edge Dairy Farmer Cooperative said today the Canadian government continues to undermine dairy provisions in the United States-Mexico-Canada Agreement (USMCA), and the co-op urged U.S. officials to reject Canada’s latest proposal for tariff-rate quotas (TRQs).
A dispute settlement panel earlier had found Canada was noncompliant with the USMCA in its use of the quotas for dairy by blocking key export opportunities for U.S. farmers and processors.
In a message to industry today, Canada shared its new proposal, which Edge said remains unfair and U.S. Agriculture Secretary Tom Vilsack said was unacceptable. Among other things, the plan would not allow U.S. exporters to ship directly to the lucrative retail sector ― a major concern for Edge’s members throughout the Midwest.
“We are disappointed to see that Canada has not changed its tune regarding the country’s dairy tariff-rate quotas. Since signing the USMCA, Canada has worked to undermine the spirit of the agreement’s dairy provisions,” said Brody Stapel, president of Edge, the third largest dairy co-op in the U.S.
“Improved access to the country’s dairy market was meant to be beneficial for the U.S. dairy industry and Canadian consumers alike, but instead our northern neighbors continue to put up roadblocks. Edge appreciates Secretary Vilsack’s forceful opposition, and we urge U.S. trade officials to stand firm against Canada’s diversions and hold the country accountable for its commitments,” Stapel said.
Under USMCA, U.S. dairy producers were granted increased market access to Canada by way of preferential tariff rates for in-quota quantities of certain products. Less than a year after implementation of the agreement in 2020, the Biden administration requested a dispute settlement panel be established to consider Canada’s failure to comply with the dairy TRQ provisions.
The panel determined that Canada’s implementation of the TRQs restricted access of U.S. dairy products by setting aside quotas specifically for Canadian processors. Per the findings of the panel, Canada is required to come into compliance. The country submitted a draft proposal of changes to the U.S. government on Feb. 2 that U.S. dairy producers insisted remained unfair. Canada formally published the proposal today.