Smith & Crapo Led Bipartisan Group of 23 Senators Including Fellow Minnesota Senator Klobuchar

WASHINGTON, D.C. [08/26/2020]—Yesterday U.S. Senator Tina Smith (D-Minn.) and Mike Crapo (R-Idaho) led a bipartisan group of 23 Senators in calling for the enforcement of United States-Mexico-Canada Free Trade Agreement (USMCA) dairy provisions. In a letter to U.S. Department of Agriculture (USDA) Secretary Sonny Perdue and U.S. Trade Representative (USTR) Ambassador Robert Lighthizer, the Senators said that holding trade partners accountable to their trade commitments is critical to supporting dairy farmers and American dairy exports. 

“Fair market access for American dairy farmers was a key pillar of the USMCA’s agriculture section,” the Senators wrote.  “USMCA is poised to create new export opportunities for America’s dairy industry and a more equitable playing field for American dairy exports in Mexico and Canada, but effective implementation will be critical to realizing these gains.”

“Canada is our closest neighbor and an important international market for Minnesota dairy. USMCA dismantles the unfair trade policies that have long prevented us from expanding our market access in Canada. However, these trade wins will only materialize if Canada is held accountable to their commitments. We appreciate the leadership of Senator Smith for working across the aisle to make sure that the hard-fought benefits of USMCA are fully realized for all of Minnesota’s dairy industry.” – Steve Schlangen, dairy farmer from Albany, Minnesota, and chairman of the Associated Milk Producers Inc. (AMPI) Board of Directors 

 “Idaho’s dairy industry is the leading agricultural sector in the state, and our dairy farmers are proud to help drive economic growth in our rural communities. However, our continued success depends on expanding opportunities for high-quality Idaho dairy exports. Senator Crapo fought for fair trade rules and equitable market access in USMCA and is now leading the charge to ensure that the agreement brings home the full benefits it promised to Idaho dairy farmers. Enforcement of USMCA’s modernized dairy trade provisions is needed now to maintain a bright future for Idaho dairy.” – Allan Huttema, dairy farmer from Parma, Idaho, and chairman of the Northwest Dairy Association/Darigold Board of Directors

You can read a copy of the letter here or below.

 

August 25, 2020

Secretary Sonny Perdue

U.S. Department of Agriculture

1400 Independence Avenue SW

Washington, DC 20250

 

Ambassador Robert Lighthizer

United States Trade Representative

600 17th Street Northwest

Washington, DC 20508

 

Dear Secretary Perdue and Ambassador Lighthizer,

Fair market access for American dairy farmers was a key pillar of the United States-Mexico-Canada Agreement’s (USMCA) agriculture section. USMCA is poised to create new export opportunities for America’s dairy industry and a more equitable playing field for American dairy exports in Mexico and Canada, but effective implementation will be critical to realizing these gains.

We share the same concerns – outlined below – as expressed in a recent letter sent to the Administration by our colleagues in the House.

Enforcement of USMCA’s dairy provisions is critical, and we ask you to ensure compliance in the following areas: 

  • Canadian dairy commitment compliance:
    • Dairy Tariff Rate Quota (TRQ) Administration: One of the most pressing priorities is how Canada handles its USMCA TRQ commitments. Unfortunately, Canada’s announced TRQ administration procedures appear to run counter to numerous USMCA provisions. Canada must administer its TRQs fairly and in a manner consistent with its obligations under USMCA; it cannot be allowed to administer TRQs in a manner that discourages utilization or restricts the ability of the U.S. dairy industry to completely fill the established TRQs at advantageous price points.
    • Elimination of Class 6 and 7: Another area of equally important concern is ensuring that the hard-fought benefits from USMCA’s elimination of Canada’s Class 6 and 7 milk pricing classes are fully realized. Canada must not be permitted to effectively recreate the harmful impacts of Canada’s highly trade-distortive Classes 6 and 7 milk pricing programs. Canada must implement its commitments to eliminate these programs with full transparency, clearly establish prices for any new classes based on the end use of dairy products, and ensure that export surcharges for certain dairy products are implemented properly.
  • Mexico common names commitment compliance:
    •  Enforcement of Common Names Side Letters: There are important implementation issues for Mexico as well, namely the work needed to translate Mexico’s commitments via two USMCA side letters pertaining to commonly used cheese terms into practice in its regulations so that all prior users’ rights are upheld and that all the common cheese names specified under the agreement are respected.

Given the importance of these provisions to our dairy farmers and to American dairy exports, we ask that you use USMCA’s enforcement measures, as appropriate, to hold our trading partners accountable to their trade commitments. It is imperative that Canada and Mexico deliver upon their agreed upon commitments related to dairy products.

Sincerely,

Issues