NMPF Executive Vice President for Communications & Industry Relations Alan Bjerga discusses the reasons why dairy farmers may be an especially influential portion of the farm vote in an interview on RFD-TV. Because dairy farms tended to cluster around major metro areas, they’re disproportionately represented in some of this year’s most closely contested states in the competition for the White House.
Tag: trade
NMPF’s Doud on High Cost of Ports Strike
NMPF President & CEO Gregg Doud said a port strike across the East Coast could cost dairy $32 million a week, and U.S. agriculture as a whole $320 million a week, in an interview with Fox Business. “We have got to make sure that we have these markets open,” Doud said, noting that even a short-term strike can cause longer-term disruptions.
NMPF’s Rice Updates Dairy Radio Now Listeners on New Export Challenges
NMPF’s Director of Trade Policy Tony Rice tells Dairy Radio Now listeners how NMPF is working to prevent a loss of milk powder exports to Colombia, which is taking unjustified steps to raise tariffs on U.S. products. Rice also provides an outlook of the potential impact on the dairy sector if a threatened labor strike materializes next week in Eastern and Southern ports.
NMPF’s Morris Discusses Colombia Trade Dispute
Shawna Morris, NMPF’s executive vice president for trade policy & global affairs, explains how Colombia moving to impose an additional tariff on U.S. milk powder exports is unjustified and unhelpful for dairy farmers and consumers in both nations. Morris speaks in an interview with RFD-TV.
U.S. defends dairy in Colombia
By Jaime Castaneda, Executive Vice President, National Milk Producers Federation
NMPF and the U.S. Dairy Export Council (USDEC) are working to preserve market access for American dairy exports to Colombia following the Colombian government’s abrupt July 5 decision to initiate a politically driven “subsidies and countervailing measures” investigation into milk powder imports form the United States.
The move has little to do with U.S. milk and everything to do with Colombia’s domestic politics. In an effort to reverse slipping popularity with voters, the Colombian government has decided to misuse trade tools usually reserved for private industry to counter legitimate damage from “dumped” product sold at below market rates. In contrast to this, Colombia’s government has instead launched this case on its own, alleging that U.S. milk powder exports from 2020 to 2023 were unduly subsidized by U.S. government programs and damaged Colombian dairy producers. Unfortunately, due to the investigation’s political nature, the Colombian government could impose tariffs on imported U.S. milk powder products as early as September 16. That would be certain to stifle trade to the market.
NMPF and USDEC have been working with U.S. exporting cooperatives and companies, legal teams, and the U.S. government to submit a strong, data-driven defense proving that this investigation is without merit.
In their counterarguments, NMPF and USDEC note that the investigation is baseless for many reasons, including:
- Product comparison: Imported U.S. milk powder and domestically produced Colombian fluid milk are distinct products with different physical characteristics and end uses, making them non-comparable.
- Subsidy misinterpretation: The Colombian government incorrectly assumes that U.S. dairy producer support directly benefits milk powder manufacturers, which is not the case.
- Lack of causal link: U.S. milk powder imports haven’t caused any damage to the Colombian dairy industry. Evidence simply doesn’t exist.
Because of the political nature of this investigation, a fair result is not guaranteed, which means that U.S. government intervention may be necessary. NMPF and USDEC are urging U.S. Trade Representative Katherine Tai and U.S. Department of Agriculture Secretary Tom Vilsack to use all available tools to respond forcefully should Colombia impose tariffs on U.S. milk powder imports despite the lack of evidence meriting such a result.
Congress is also paying attention. A letter sent by the bipartisan leads of the U.S. House of Representative’s Agricultural Trade Caucus to the Colombian Ambassador to the United States highlights the U.S. dairy industry’s long-standing commitment to work with its Colombian counterparts and encouraged the two industries to work together to strengthen the dairy sectors in both countries instead of pursuing meritless investigations.
Colombia’s investigation will play out over months, starting with preliminary results and potential provisional measures as early as September 16, followed by a public hearing and additional comment periods.
At stake is $70 million in annual U.S. milk powder exports to Colombia.
While not a trivial amount by any means, this investigation could also set a dangerous precedent for like-minded governments to imitate. Over the past several years, protectionist sentiments have grown around the world, and Latin America is no exception. The region has become a battleground in the effort to preserve existing trade opportunities, flaring up from Peru and Ecuador to Brazil and Mexico.
While cooperating with the investigation, NMPF and USDEC continue to engage with policymakers and allied organizations to seek a positive conclusion. Regardless of which way this investigation turns out, it’s important for the United States to respond forcefully and let its trading partners know that such maneuvers will not be tolerated.
This column originally appeared in Hoard’s Dairyman Intel on Sept. 5, 2024.
NMPF’s Castaneda on Colombian Trade, FMMO
NMPF Executive Vice President, Policy Development & Strategy Jaime Castaneda discusses potential dairy trade issues between the U.S. and Colombia, the latest on FMMO updates, and common food names with host Jesse Allen on this Agriculture of America podcast.
NMPF, USDEC Urge U.S. Government to Preempt Colombian Trade Barriers
The National Milk Producers Federation (NMPF) and the U.S. Dairy Export Council (USDEC) are asking the U.S. government to prepare a plan to “leverage all available tools” should Colombia move forward with imposing countervailing tariffs on U.S. milk-powder exports, making that request in a letter sent Friday to U.S. Trade Representative Katherine Tai and U.S. Agriculture Secretary Tom Vilsack.
NMPF and USDEC also commended a complementary Congressional letter sent Friday to Colombian Ambassador to the United States Luis Gilberto Murillo in response to the investigation. Led by Reps. Jim Costa, D-CA, Adrian Smith, R-NE, Jimmy Panetta, D-CA and Dusty Johnson, R-SD, the letter highlights that the U.S. and Colombian dairy industries should be working collaboratively to promote policies that strengthen the dairy sector instead of launching “damaging protectionist investigations.”
Colombia’s recent decision to initiate an unwarranted Subsidies and Countervailing Measures investigation into U.S. exports of milk powder is a tariff threat without merit, USDEC and NMPF say in the letter, noting that no causal link exists between U.S. milk powder exports and the injury alleged by Colombian officials. The letter also explains that imported milk powder products and domestically produced fluid milk are not interchangeable ingredients in a food manufacturing facility.
“The U.S.-Colombia Free Trade Agreement has been a success story for American and Colombian producers and consumers alike,” said Krysta Harden, president and CEO of USDEC. “Initiating unfounded investigations undermines this progress and is a step backward in our trade relationship. We appreciate the Ag Trade Caucus leaders for recognizing this investigation for what it is – baseless. USDEC commends the U.S. interagency team for their extensive work on the ongoing investigation and will continue to work closely with the U.S. government and Congress as the legal process moves forward.”
“NMPF appreciates Representatives Costa, Smith, Panetta and Johnson for standing up for American dairy producers’ market access rights,” said Gregg Doud, president and CEO of NMPF. “We will continue working with the U.S. government to ensure this unsubstantiated investigation doesn’t set a dangerous precedent.”
NMPF, USDEC Expand Strong Partnerships in South America
The National Milk Producers Federation (NMPF) and the U.S. Dairy Export Council (USDEC) advanced a pair of partnerships in South America this week. The organizations signed a Memorandum of Understanding (MOU) with Abraleite, a prominent Brazilian milk producers association, and renewed an existing MOU with Argentine farmer organization Sociedad Rural Argentina (SRA).
The agreements enhance cooperation between the United States and South American dairy industries, focusing on critical areas such as the economic and social significance of the dairy sector and the removal of trade barriers affecting both producers and consumers.
“Our engagements in South America this week underscored the shared challenges and opportunities facing dairy producers and processors in the United States, Brazil and Argentina,” said Krysta Harden, president and CEO of USDEC. “Partnerships with likeminded organizations have been proven to be crucial as we strive to promote the benefits of dairy on the international stage and tackle attempts to erect trade barriers throughout the Americas.”
The updated MOU with SRA includes the launch of a Sustainability and Trade Taskforce, an initiative to provide a balance to European policies that could unfairly impact producers in the United States and Argentina. Objectives include demonstrating that livestock production is a cornerstone of sustainable food systems and advocating for science-based trade policies.
“Dairy producers throughout the Western Hemisphere confront many of the same issues and priorities,” said Gregg Doud, president and CEO of NMPF. “We look forward to working alongside Abraleite and SRA to advance policies that promote dairy and limit trade barriers.”
The two MOUs follow a partnership signed on June 4 with the Colombian dairy organization Asoleche. The partnership formalized USDEC and NMPF’s prior collaboration with Asoleche, demonstrating the value in focusing on areas of common ground, in contrast to the politically driven countervailing duty investigation into U.S. milk powder exports recently initiated by the Colombian government.
In addition to the Latin American partnerships in Argentina, Brazil, and Colombia, USDEC and NMPF have also established MOUs with the Inter-American Institute for Cooperation on Agriculture (IICA) and the Chilean Federacion Nacional de Productores de Leche (Fedeleche).
Pushing for Lower Tariffs Worldwide
By Jaime Castaneda, Executive Vice President, Policy Development & Strategy, National Milk Producers Federation
Exports are critical to America’s dairy farmers and processors. Last year, the American dairy industry exported $8.1 billion in dairy products, roughly 17% of total U.S. milk production. That’s the second-best year on record, falling just short of 2022.
As global demand for high-quality and sustainably-produced dairy products will grow, the U.S. dairy industry must keep exports expanding to thrive today and over the long term. To help encourage that, and in the absence of efforts by the U.S. government to secure new market openings, the National Milk Producers Federation (NMPF) and the U.S. Dairy Export Council (USDEC) have taken the initiative to drive forward projects to pursue Most-Favored Nation (MFN) tariff reductions in multiple key export markets.
U.S. dairy’s quarter-century of export expansion hasn’t been by chance. The strong commitment from U.S. dairy producers and manufacturers to investing in painstakingly growing international sales, coupled with multiple trade agreements that opened the door for that growth to occur, are key drivers of the trend. Unfortunately, in recent years, anti-trade rhetoric has gained momentum from politicians on both sides of the aisle. Meanwhile, major competitors — namely in Europe, Australia, and New Zealand — have successfully negotiated new market access, advantaging their domestic producers through lower tariff rates and favorable trading conditions. The result is that U.S. producers are increasingly at a disadvantage in several key markets, including China and most countries in Southeast Asia.
MFN tariffs are tariff rates that one country applies to imports from all trading partners that are members of the World Trade Organization. Importantly, MFN tariffs do not apply to products that benefit from even lower rates due to preferential trade agreements, such as a free trade agreement or customs union.
Not content to yield key markets to trade competitors, NMPF and USDEC launched a formal initiative in 2014 to lower duties on U.S. dairy exports in China. Following years of engagement, that resulted in a tariff cut on U.S. cheese exports. A few years later in 2019, NMPF and USDEC’s efforts scored another breakthrough by securing tariff reductions on a variety of exported dairy products into Vietnam.
Halfway around the globe, NMPF and USDEC tallied a small victory in March by successfully petitioning the United Kingdom government to eliminate its 6% tariff on fat-filled milk powder for at least two years.
NMPF and USDEC are continuing to pursue MFN tariff cuts in other key markets around the globe as well, with an emphasis on the growing Asian region, even as government initiative is lacking.
For example, the Philippines is a sizable dairy importer, using those inputs in the Philippine food processing and food service sectors. NMPF and USDEC have impressed upon the Philippine government the advantages of diversifying its dairy supply chains further and are petitioning for MFN tariff reductions for a variety of products, including cheese, lactose, and milk powder.
Although these initiatives by NMPF and USDEC cannot fully replace government negotiation of new trade agreements, efforts to drive down tariffs in these countries represent just a few examples of the markets that NMPF and USDEC are prioritizing as they continue to fight for fair opportunities for U.S. dairy producers and companies to compete in the global market.
This column originally appeared in Hoard’s Dairyman Intel on April 4, 2024.
NMPF’s Castaneda Discusses WTO, India, CWT
NMPF Executive Vice President Jaime Castaneda discusses efforts to expand dairy market access at recent World Trade Organization meetings in Abu Dhabi in an interview with the Red River Radio Network. Castaneda also discusses trade relations with India and the importance of the NMPF-led Cooperatives Working Together program for the future of U.S. dairy exports.
NMPF’s Bjerga on Trade, FMMO
NMPF Executive Vice President Alan Bjerga speaks with RFD-TV about how all of agriculture needs to fight for the integrity of trade agreements in the wake of a USMCA dispute panel decision that failed to protect U.S. access to Canada’s market. The President’s Export Council, with member co-op Land O’Lakes representing farmers, discussed the importance of market access in a White House meeting on Wednesday. Bjerga also talked about the resumption of the USDA Federal Milk Marketing Order hearing in Indiana this week, and how repeated delays aren’t helpful for milk producers.
USMCA Dispute Panel Limits Canadian Market Access
Today’s ruling by a U.S-Mexico-Canada Agreement (USMCA) dispute panel allowing Canada to restrict the dairy access that the United States negotiated for in the USMCA pact weakens the agreement’s value to the US dairy industry, according to the National Milk Producers Federation and the U.S. Dairy Export Council.
An earlier panel ruled in January 2022 that Canada had improperly restricted access to its market for U.S. dairy products. In response, Canada made insufficient changes to its dairy tariff rate quota (TRQ) system, resulting in an outcome that still fell far short of the market access the U.S. expected to receive under USMCA. To address that shortcoming, the U.S. brought a second case to challenge the changes that Canada instituted. Today the panel announced that Canada was not obligated to make further changes.
“It is profoundly disappointing that the dispute settlement panel has ruled in favor of obstruction of trade rather than trade facilitation,” said Jim Mulhern, president and CEO of NMPF. “Despite this independent panel’s adverse ruling, we’d like to thank the Biden Administration and the many members of Congress who supported us for their tireless pursuit of justice for America’s dairy sector. We urge Ambassador Tai and Secretary Vilsack to look at all available options to ensure that Canada stops playing games and respects what was negotiated.”
Since the U.S. Trade Representative initially launched the first dispute settlement case against Canada in 2021, USDEC and NMPF have worked with USTR, USDA, and Congress to try to secure full use and value of USMCA’s dairy TRQs for American dairy producers and processors.
“By allowing Canada to ignore its USMCA obligations, this ruling has unfortunately set a dangerous and damaging precedent,” said Krysta Harden, president and CEO of USDEC. “We do however want to express our appreciation for allies in Congress and the Administration for their efforts and commitment to fighting for U.S. dairy. This is unfortunately not the only shortcoming in Canada’s compliance with its international commitments. We are committed to working with USTR and USDA to evaluate efforts to address Canada’s continued harmful actions that depress dairy imports while simultaneously evading USMCA’s dairy export disciplines.”
When first implemented in 2020, USMCA established 14 different TRQs, which allow a predetermined quantity of imports at a specified low tariff rate. The TRQ system that Canada implemented awarded the vast majority of TRQ volumes to Canadian processors and granted very limited access to TRQs to distributors – resulting in limited market access for U.S. exporters. Minor modifications to that system made in 2022 have continued that imbalanced approach.
