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U.S. Dairy Industry Pursues Trade Negotiations with Canada, Russia

July 10, 2012

Canada has been extended an invitation to actively join the ongoing Trans-Pacific Partnership (TPP) trade agreement negotiations.

NMPF and the U.S. Dairy Export Council (USDEC) strongly supported Canada’s participation in the TPP negotiations. Both groups agreed that since Mexico has been invited to join the talks, it only makes sense for the third member of the North American Free Trade Agreement (NAFTA) to join as well. However, whereas Mexico and the United States already have removed all dairy trade barriers between them, this is not the case with respect to trade between Canada and the United States—a situation which the two organizations said must be remedied.

According to the dairy groups, the U.S. government’s approval of Canada’s participation in the TPP talks has been accompanied by a very clear understanding of U.S. expectations that all Canadian trade barriers against U.S. dairy products must be eliminated. This requirement was fundamental to gaining the groups’ support.

“The U.S. dairy sector hopes to see significant gains from a well-negotiated TPP and welcomes Canada’s membership as an important step towards achieving this goal,” said Jerry Kozak, president and CEO of NMPF. “The United States and Canada have had a free trade agreement since 1988, but it did not include dairy products. It is time for this oversight to be changed and we welcome this opportunity to finally make that happen.”

Meanwhile, legislation was introduced in the Senate last month to extend Permanent Normal Trade Relations (PNTR) to Russia. Senator Baucus (D-MT), Finance Committee Chairman; Senator John Thune (R-SD), International Trade Subcommittee Ranking Member; Senator John Kerry (D-MA), Foreign Relations Committee Chairman; and Senator John McCain (R-AZ), Armed Services Committee Ranking Member, introduced the bipartisan legislation in order to enable U.S. companies to expand exports to Russia when it joins the World Trade Organization (WTO) this year.

Russia is expected to complete the necessary administrative and regulatory changes and thereafter to actively join the WTO this August. Those commitments include provisions relating to agricultural trade, which NMPF and USDEC believe will yield significant improvements in tariff levels as well as in how Russia deals with various regulatory requirements for imported dairy products.