News & Resources

NMPF Leads Coalition Letter Urging Trade Agreement with Japan

September 4, 2019

A tentative agreement on trade between the U.S. and Japan that’s expected to benefit dairy is being watched closely by NMPF and the U.S. Dairy Export Council, who worked together in August to unite dairy cooperatives, companies and organizations from across the country to urge the U.S. government to move swiftly to finalize a strong trade deal that secures U.S. dairy access to this promising market.

NMPF and USDEC led a coalition of 70 dairy companies, farmer-owned cooperatives, and associations in an Aug. 19 letter to the United States Trade Representative and the U.S. Secretary of Agriculture encouraging the U.S. government to negotiate a trade deal that builds upon the best components of the CPTPP and Japan-EU agreements, both of which give preferential trade terms to major global competitors in Japan. Members joined the effort to send a unified message that increasing our market access in Japan is vital for U.S. dairy.

Japan is the fifth-largest overseas market for U.S. dairy, with $270 million in U.S. exports to Japan in 2018. It’s already the world’s second biggest net dairy importer, with per-capita consumption of dairy products increasing at a rate of four percent a year. At the same time, domestic production is decreasing and unable to meet market needs.

However, Japan’s preferential trade deals with America’s largest competitors are limiting this opportunity for U.S. dairy. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and Japan-EU agreements have allowed the European Union, New Zealand and Australia to position themselves to take sales from the U.S. dairy industry. U.S. sales to Japan may fall by 50 percent over a decade, costing the U.S. dairy industry $1.3 billion, according to a USDEC study. These lost sales will cost farmers $1.7 billion in revenue, harming dairy farmers, processors and rural communities alike.

“NMPF partnered with USDEC to organize this unified dairy sector message to the U.S. government because a healthy dairy industry requires trade negotiators to decisively pursue foreign markets and secure robust opportunities for U.S. dairy exports,” said Jim Mulhern, president and CEO of NMPF. “Growing our foothold in the expanding Japanese dairy market will be critical to strengthening milk prices for American producers and fueling economic recovery in farm country.”

The letter also asked trade negotiators to safeguard the use of common cheese names, by ensuring that any agreement draws upon the precedents pioneered under the United States-Mexico-Canada Agreement (USMCA) to combat the EU’s efforts to monopolize the use of common name products through the misuse of geographical indications.

Japan and the U.S., who confirmed an agreement “in principle” late in August, are aiming to sign a final deal timed to the United Nations General Assembly meetings later this month.