U.S. takes aim at Canada’s dairy quotas

WASHINGTON, D.C.— The United States is formally accusing Canada of unfairly limiting the ability of American dairy producers to sell their products north of the border.

The U.S. has made an official request for consultations to address Canada’s limits on a variety of dairy products — an initial step in the first enforcement action under the U.S.Mexico-Canada Agreement since the deal took effect in July.

The limits in question are in Canada’s so-called tariff-rate quotas — the quantities of certain goods that can be imported under preferential duties. The U.S. is accusing Canada of assigning too much of its quotas to processors, denying American producers the level of access to which they’re entitled.

“Canada’s measures violate its commitments and harm U.S. dairy farmers and producers,” trade ambassador Robert Lighthizer said in a statement.

The next step, presuming the consultation process doesn’t produce a resolution, would be to set up a dispute resolution panel under the terms of the agreement.

Wednesday’s action comes as little surprise; the U.S. Dairy Export Council set the table in June when it complained that Canada’s tariff-rate quotas deny American farmers rightful access to markets north of the border. The federal Liberal government rejects that claim, insisting that the quotas are well within the bounds of the agreement.