U.S. maintains firm stance on dairy
WASHINGTON Despite recent suggestions to the contrary, U.S officials negotiating a new NAFTA deal have demanded that Canada end its supply-management system for dairy and egg products, Ottawa’s deputy ambassador to the United States said Tuesday.
And that request is a non-starter for Canada, Kirsten Hillman stressed to a conference here.
The dairy sector has been a hotbutton issue in wrangling over a new North American Free Trade Agreement, with President Donald Trump complaining about protection of the Canadian industry and tariffs of almost 300 per cent on U.S. dairy exports to Canada.
Yet just last month, Agriculture Secretary Sonny Perdue said the U.S. is not trying to get Canada to “ditch its supply management system,” only to manage it better so over-supply doesn’t flood the world market.
A senior Agriculture Department official with ties to the White House reiterated that position later, focusing his critique on a specific Canadian subsidy program.
But it’s a different matter in the actual talks over NAFTA, said Hillman. “He (Perdue) did say that, but the truth is that at the negotiating table, the U.S. demand hasn’t changed,” she said after speaking on a panel organized by the Politico news agency.
“At this point in time, the request that has been put on the table is that we get rid of what’s called supply management,” she told the audience earlier. “And that’s an unacceptable request for us.”
Hillman said she wanted to address “misunderstandings” about the issue, citing a limited quota that allows U.S. farmers to sell over US$500 million of milk and other products into Canada yearly without duties — four or five times more than what goes the other direction.
“There is a misconception, I think, out there that Canada has in place tariffs in the dairy sector that do not allow for trade in this area,” she said. “Canada is actually the United States’ second-largest export market for dairy products.
Moderator Doug Palmer, a Politico journalist, noted that U.S. dairy farmers feel they could and should be able to sell more but cannot because of the barriers that do exist.
And Ted McKinney, the undersecretary of agriculture for trade, said recently that Canada’s “classseven” milk management system, which provides discounted ingredients to Canadian makers of processed dairy products, was a major obstacle to a NAFTA deal. U.S. farmers say it curbs their access to Canada and lowers world prices.