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Trade Policy Victories for U.S. Dairy

December 26, 2022

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.