Tag: EU agriculture trade

The EU Wants to Tell Its Partners How to Farm

Posted on by Alan Bjerga

Shawna Morris HeadshotBy Shawna Morris, Executive Vice President, Trade Policy & Global Affairs, National Milk Producers Federation

In business, a top customer is a very important relationship, one that requires careful tending and cultivation to maintain. The best business relationships are two-way streets, with each party tending to the other’s needs with care. These are simple principles for successful commerce — but they also seem to have been forgotten in the European Union (EU) when it comes to dairy.

The U.S. is one of the EU’s top food and agricultural export markets; in dairy alone, it shipped an eye-popping $2.7 billion of cheese, butter, food preparations, and other dairy products to America. This year it’s on track to top that record, with sales through July up 12%. The U.S. is a major and lucrative market for the EU’s dairy industry and other food sectors.

With all that on the line, it would be reasonable to expect the EU to prioritize U.S. trade concerns. Instead, the EU is increasingly seeking to use trade policy to dictate to the world — including American dairy farmers — how to farm and, while serving its own self-interest, how to properly produce products.

National Milk Producers Federation (NMPF) and U.S. Dairy Export Council (USDEC) staff met last week with the EU’s Health and Food Safety Agency on one of the EU’s latest policies advancing that goal. Article 118 is a rule slated to impose new restrictions on which veterinary medicines EU trading partners can use for any products destined for the EU. Given the interconnected nature of milk flows in the U.S., however, requirements for EU shipments can impact a much wider swath of U.S. production to avoid disrupting supply chain flexibilities.

In that meeting, NMPF and USDEC, together with the other U.S. agricultural organizations, strongly objected to the EU imposing its domestic farm process steps on American farmers. We also pointed out the importance of a two-way relationship: The EU relies on the United States continuing to reliably import billions of dollars of EU products that are produced in keeping with EU farm process requirements, not American ones.

NMPF staff, working closely with our partners at USDEC, has engaged with the U.S. government, other agricultural sectors, and the EU itself for the past few years in trying to shape the implementation of this regulation. Thanks to that extensive investment in staving off the worst edges of this ill-conceived EU policy, U.S. dairy exports aren’t expected to be affected by the initial list of targeted veterinary medicines. But what’s true today may not be tomorrow. NMPF continues to work on this issue to guard against any future inclusion of more broadly used safe veterinary medicines down the road.

Article 118 is just one of many policies the EU is pushing to foist its farming preferences onto the world’s farmers. Issuing specific animal welfare standards for trading partners is also under development, even though U.S. dairy farmers know how to farm safely and hold high standards while exporting to more than 100 markets worldwide. European bureaucracy does nothing to elevate the quality of U.S. dairy products, but it does risk exacerbating trade tensions.

Because of this growing EU tendency to attempt to serve as a global regulator, NMPF is encouraging the U.S. government to look more strategically at the U.S.-EU agricultural trade relationship. Every customer has its breaking point, and the U.S. should make clear to the EU that we are no different. The trans-Atlantic partnership between U.S. and EU interests is one of the world’s most important. But all good relationships are based on care and respect. We in dairy are urging the EU to tend its trade relationship with the U.S. more carefully, because if they don’t, the consequences will be pleasant for no one.

This column originally appeared in Hoard’s Dairyman Intel on October 5, 2023.

Record Exports Drive U.S. Dairy Demand

Posted on by Theresa Sweeney

By William Loux, Vice President, Global Economic Affairs, NMPF and U.S. Dairy Export Council.

U.S. dairy exports excelled again in 2022, with record shipments further cementing its role as the key demand driver for U.S. milk.

For the third consecutive year, the U.S. dairy industry set a record for the volume of dairy products exported on a milk solids equivalent basis, with the current record now surpassing 2.4 million metric tons — the equivalent of over 40 billion pounds of raw milk, or 18% of the U.S. milk supply.

Perhaps even more impressive, for the fifth time in the last six years, U.S. exports grew by more than domestic consumption. Of that six-year window, 2019 was the only time in that span when exports grew by less than domestic sales. That’s the year the U.S. faced prohibitive retaliatory tariffs on dairy products destined for China. In addition, African Swine Fever was cratering China’s demand for whey products. At the same time, U.S. skim milk powder exporters were facing headwinds from EU intervention storage stocks that began hitting the market at below-market prices in 2019. All this noted, with 2019 being a particularly unique exception, the international market has been the driver of U.S. dairy demand growth for the past six years.

Success can’t be taken for granted

European milk production came on strong at the tail end of 2022 as favorable weather and margins boosted output. Conversely, demand within the European Union bloc has reportedly weakened as consumers feel the squeeze on their wallets, which is causing European wholesale prices to dip. With more supply, weaker internal demand, and low prices, we can expect significantly more competition from Europe in the international market than we did in 2022 when their exports dropped 10% during the first 11 months of the year.

Additionally, the international demand picture remains uncertain. Despite the clear success of U.S. dairy, the world’s collective dairy trade actually dropped 4% in 2022 — primarily on account of China. The world’s largest dairy product-importing nation contracted dairy imports by 21% as the country drew down inventories built in 2021, witnessed a surge in domestic milk supplies, and instituted movement restrictions, all of which damaged dairy consumption and imports.

China’s return to the market in 2023 remains uncertain. The lockdowns have been lifted, but milk production in the country is still growing, and inventories of milk powder reportedly remain heavy. Optimistically, consumption in the country will rebound and stockpiles will be reduced, setting the stage for China’s return as a global buyer in the middle part of the year. But until they do, New Zealand, which exported over 40% of its production to China at its peak, will have plenty of products available for customers elsewhere, meaning increased competition with the United States.

Outside of China, the demand picture will likely be mixed depending on local conditions, but broadly, slower economic growth and inflation are expected to challenge lower-income consumers and push buyers to look for bargains.

Overall, I am forecasting international demand in 2023 to return to growth, but not at a spectacular rate, and with more suppliers competing for business.

Given the expected headwinds this year, industry investment in international markets will be critical to success. To set another record in 2023, the U.S. must continue the work being done to build demand for U.S. dairy products overseas and expand market access in key markets, all while maintaining reliability with international customers by being engaged and responsive.

This column originally appeared in Hoard’s Dairyman Intel on Feb. 21, 2023.

NMPF’s Morris on Holding Canada Accountable

Posted on by Alan Bjerga

 

NMPF and USDEC Senior Vice President for Trade Shawna Morris discusses the latest round of conflict between the United States and Canada over over U.S. dairy access to that market. Morris praised the U.S. government’s willingness to take on Canada again after already winning on dispute before a USMCA dispute resolution panel. Morris speaks in an interview on RFD-TV.

Trade Policy Victories for U.S. Dairy

Posted on by Alan Bjerga

Shawna Morris HeadshotBy Shawna Morris, Senior Vice President for Trade, NMPF and U.S. Dairy Export Council.

The National Milk Producers Federation (NMPF) and the U.S. Dairy Export Council (USDEC) are proud to be the voice of defending the American dairy industry and promoting dairy exports in Washington D.C. and around the world. Looking back at this past year of trade policy, American dairy producers and the entire industry have much to be proud of.

U.S. dairy exports are on track for another record year in both value and volume — despite a lack of new market access, protectionist actions in key markets, and ongoing supply chain challenges.

Working with the government to help U.S. dairy thrive

The record export numbers are happening despite high costs and unreliable shipping networks that are still causing headaches for the industry more than two years after the global COVID-19 outbreak first snarled supply chains.

NMPF and USDEC have led the way in working with the U.S. government to address the concerns. In June, President Biden signed the Ocean Shipping Reform Act into law. Championed by NMPF and USDEC, the legislation limits ocean carriers’ ability to deny exports and charge unreasonable fees, clearing a significant hurdle for dairy exporters.

Elsewhere, the EU’s abuse of geographical indication rules continues to threaten U.S. producers’ access to foreign markets for common-name cheeses like “Parmesan” and “Feta.” In collaboration with the Consortium for Common Food Names (CCFN), NMPF and USDEC have pushed the U.S. government to proactively defend the rights of U.S. cheesemakers and fought the court battles necessary to advance this effort.

That work resulted in a key win last January, when a U.S. District Court ruled in our favor that “Gruyere” cheese can be produced anywhere – not just in France or Switzerland. This landmark victory again proved that common names are widely understood to refer to types of food, regardless of where they are produced.

Holding Canada responsible

The U.S.-Mexico-Canada Agreement (USMCA) provided a much-needed update to trade rules. NMPF and USDEC supported it as a deal that would increase exports and boost farm gate milk prices.

Unfortunately, Canada hasn’t held up its end of the bargain. By reserving most of its dairy tariff rate quotas (TRQs) for Canadian processors and directly impairing American exporters’ ability to access the Canadian market, it’s clearly a break of the USMCA’s TRQ provisions that allow market access.

NMPF and USDEC successfully advocated for last year’s initiation of the first-ever USMCA dispute settlement process. The United States won the initial case in January, but upon Canadian refusal to comply with the ruling, NMPF and USDEC prompted the U.S. government to pursue a second dispute panel, resulting in the U.S. seeking formal consultations with Canada in May. The organizations have urged a strong response on behalf of wronged U.S. dairy industry members to ensure that America’s dairy sector receives the full export benefits promised under the agreement.

Strengthening relationships in Latin America

NMPF and USDEC finalized partnerships with the Chilean National Federation of Producers (Fedeleche) and Rural Society of Argentina this year that will advance shared policy priorities internationally. Far more than just agreements on paper, these relationships set a foundation to confront emerging threats, both in key export markets and in international standard-setting bodies to ward off anti-trade and anti-dairy policies.

These examples are just a slice of the trade policy issues that touched the U.S. dairy industry in 2022, but each highlights the great potential of the American dairy industry to grow worldwide and shows the need for the U.S. government to work with us to get there. Looking to 2023 and beyond, NMPF and USDEC are looking forward to ensuring that exports keep growing in volume and in value, supporting the bottom line of dairy farmers, manufacturers, and workers throughout the country.

This column originally appeared in Hoard’s Dairyman Intel on Dec. 26, 2022.

Live, from the Dairy Bar, it’s NMPF!

Posted on by Alan Bjerga

 

NMPF Senior Vice President of Communications Alan Bjerga gives an impromptu tour of the Dairy Bar and the Joint Annual Meeting in Denver. From delicious products to critical information, the Dairy Bar has it all — and the meeting itself resulted in gains for dairy producers, as detailed in this interview with RFD-TV.

NMPF’s Bjerga on Ukraine Food Crisis, Dairy’s Humanitarian Support

Posted on by Alan Bjerga

 

NMPF Senior Vice President of Communications Alan Bjerga discusses the unfolding food crisis in Ukraine, where world leaders are trying to figure out how to transport its crisis in the midst of war, in an RFD-TV interview from Krakow, Poland. Bjerga notes the efforts of the dairy community to help those in need and highlights NMPF’s role as an outlet for support.

NMPF’s Bjerga on How DMC Fights Inflation

Posted on by Alan Bjerga

 

NMPF Senior Vice President of Communications Alan Bjerga explains how the Dairy Margin Coverage Program helps protect farmers against rising feed-cost inflation by factoring in higher expenses even as milk prices reach records. Bjerga also talks about the potential market effects of Russia’s invasion of Ukraine and spells his last name for listeners in an interview with WEKZ radio, Janesville, Wisconsin.

NMPF’s Bjerga on the State of Dairy Labeling

Posted on by Alan Bjerga

With a new FDA commissioner nearing confirmation, NMPF Senior Vice President for Communications Alan Bjerga discusses the state of dairy labeling in the U.S., on RFD-TV. Bjerga also talks about U.S. dairy’s recent win over the European Union on gruyere cheese, which a court ruled is a common name not subject to geographical indication trade restraints.

NMPF’s Bjerga Discusses CEO’s Corner, Trade Growth

Posted on by Alan Bjerga

 

NMPF’s Senior Vice President for Communications, Alan Bjerga, discusses NMPF’s “CEO’s Corner” for June, which deals with U.S. dairy’s growing leadership in sustainable dairy exports. The monthly thought-leadership series highlights key dairy issues of the day from an NMPF perspective and is part of the organization’s “Sharing Our Story” initiative that spotlights farmer voices and industry commentary. Bjerga spoke on WEKZ radio, Janesville, Wisconsin.

NMPF Urges USTR to Enhance Efforts to Protect Use of Common Cheese Names

Posted on by Theresa Sweeney

NMPF joined with USDEC to submit comments on Jan. 28 to the U.S. Trade Representative’s Office urging a more robust approach to preserving U.S. cheesemakers’ ability to export their products that rely on common cheese names such as parmesan, feta, asiago and others. The submission also voiced strong support for more detailed comments filed by the Consortium for Common Food Names. Both were filed in response to USTR’s call for input to inform its annual Special 301 Report on Intellectual Property issues that documents key IP challenges facing U.S. companies and what USTR is doing to address them.

NMPF noted in the comments that EU use of FTAs to erect barriers to competition “creates a deeply uneven playing field that makes it much more difficult to successfully export the products that American workers have created using milk from U.S. farms.” To address this, NMPF urged the Administration to “secure firm and explicit commitments assuring the future use of specific generic food and beverage terms targeted by or at risk of EU monopolization efforts” and noted that last year more than 160 Senators and Republicans had urged the pursuit of that policy.

Bipartisan Congressional Letter Calls for Stronger U.S. Approach to Preserving Common Food and Wine Terms

Posted on by Theresa Sweeney

A coalition of leading farm and agricultural groups are applauding a bipartisan letter sent today by 111 members of Congress urging stronger protections for American-made food and wine exports using common terms. This is an important message regarding the need for enhanced U.S. efforts to combat the European Union’s (EU) attempts to ban U.S. exports of cheese, meat and wine products that are labeled with common terms – such as parmesan, bologna or chateau.

“Congress has spoken loudly; it is time for stronger action by the U.S. government. For far too long, Europe has used unjustified trade barriers to block competition from high-quality American-made cheese, meat and wine exports. Europe is undermining global trade rules and weakening intellectual property system protections internationally. Today’s letter is an important reminder that we must raise the bar in our efforts in order to prevail in creating agricultural trade policy that works for the world, not just the European Union,” said Jaime Castaneda, Executive Director of Consortium for Common Food Names.

The letter asks the U.S. Trade Representative (USTR) and U.S. Department of Agriculture (USDA) to make safeguarding common food and wine terms a core policy objective in all current and future trade negotiations. The effort was led by Reps. Jim Costa (D-CA), Jodey Arrington (R-TX), Angie Craig (D-MN), Dusty Johnson (R-SD), Ron Kind (D-WI), Mike Gallagher (R-WI), Jimmy Panetta (D-CA) and Mike Kelly (R-PA).

“The EU’s ban on common cheese terms has already impeded U.S. dairy exports but even more severe consequences for our industry lie ahead if the EU is allowed to continue these unfair trade practices. Preserving export opportunities for American-made cheeses and other products labeled with common terms must take priority in all future trade negotiations. I applaud Congress and the leaders of this effort for setting this important precedent in defense of American-made exports,” said Tom Vilsack, president and CEO of U.S. Dairy Export Council.

“Creating false barriers to block exports denies families around the world the high-quality food America’s farmers and ranchers produce. It’s trade manipulation. We applaud the U.S. government for its efforts to remove unfair trade practices that keep our nation from competing in the global marketplace,” said American Farm Bureau Federation President Zippy Duvall.

“The European Union has for too long unjustifiably and erroneously attempted to restrict trade in common food name products, including meat exports from the U.S. The policy advocated in the bipartisan letter sent today to USDA and USTR will advance critical safeguards for common food name products in international trade and will enable America’s meat and poultry packers and processors, agricultural producers and food manufacturers to compete on a level playing field with their counterparts in the EU. We thank members of Congress for their leadership, and we stand ready to work with the Administration to defend against anti-competitive and protectionist policies pursued by trading partners that serve only to impede U.S. meat and poultry exports,” said Julie Anna Potts, CEO of the North American Meat Institute.

“NASDA Members work tirelessly with the federal government to open new doors for agricultural producers around the world. We encourage the U.S. Trade Representative (USTR) and U.S. Department of Agriculture (USDA) to amplify the importance of common food and wine terms as a core policy objective to successful free trade negotiations in the future. Doing so will ensure consumers are able to access the full bounties of our farmers and ranchers around the world,” said National Association of State Departments of Agriculture CEO Dr. Barb Glenn.

“America’s dairy farmers have been unduly harmed by the EU’s efforts to limit market opportunities for U.S. dairy products. For years, the EU has sought to ban high-quality American-made cheeses, putting U.S. dairy jobs at risk and limiting economic growth in the rural communities that rely on a healthy dairy industry.  I appreciate the important work being done by Congress to ensure that U.S. trade negotiators must have all necessary tools at their disposal to fight back against the EU’s destructive agenda,” said Jim Mulhern, president and CEO of National Milk Producers Federation.

“We have watched time and again as the EU has gone well beyond protecting legitimate GIs to erect trade barriers that benefit their own producers at our expense. The recent EU-China agreement on GIs is a perfect example of how the EU abuses GIs for their own gain. The U.S. must do more to ensure a level playing field for common food names, grape varietal names and traditional terms and we are grateful to these Representatives for supporting this effort,” said Bobby Koch, President and CEO of Wine Institute.

In July, 61 Senators sent a similar letter requesting that the U.S. government enhance protections for common food and wine terms.