USMCA Takes Effect, Enforcement Remains Key
July 2, 2020
U.S. dairy farmers are concerned about possible bad-faith actions from Canada even as the United States-Mexico-Canada Agreement (USMCA) agreement entered into force July 1, with Canada’s announced Tariff-Rate Quota (TRQ) allocations undermining the trade deal by thwarting the ability of the U.S. dairy industry to make full use of the trade agreement’s market-access opportunities and violating some of the treaty’s provisions on TRQs.
USMCA implementation caps years of hard-fought negotiations to break down trade barriers and institute fairer rules to improve the flow of U.S. dairy products throughout North America, and U.S. dairy farmers and cooperatives stand ready to increase deliveries of high-quality U.S. dairy products to Canada. The TRQ action undercuts the agreement by effectively limiting agreed-upon U.S. access.
“U.S. farmers will bear much of the brunt of this bad-faith approach by Canada to implementing USMCA’s dairy provisions.” said Jim Mulhern, president and CEO of the National Milk Producers Federation. “Canada needs to change its course and abide by its commitments.”
NMPF has repeatedly warned that the full benefits of this carefully negotiated trade agreement will not materialize without careful monitoring and stringent enforcement of Canada’s commitments under USMCA. While not unexpected, Canada’s latest efforts to manipulate its agreed upon trade obligations to protect its tightly controlled dairy market are unacceptable.
NMPF has been in close contact with USTR and USDA to urge swift action towards a resolution that ensures Canada is held strictly responsible for abiding both by the letter and intent of USMCA.
The organization also has been in contact with lawmakers, most recently working with Congressional offices to spotlight Canada USMCA compliance concerns during Congressional oversight hearings and lending support to a letter sent by Senator Charles Schumer (D-NY), urging USTR to ensure that Canada live up to the commitments it made to the U.S. on dairy access, including on the negotiated TRQ allocations as well as the elimination of Classes 6 and 7, which created conditions for dumped Canadian exports.