US rejects Canada’s second proposal to fix dairy quotas

U.S. Agriculture Secretary Tom Vilsack mentioned Saturday that Canada’s second proposal for modifying its tariff fee quotas for U.S. dairy is unacceptable and that key modifications are wanted earlier than the dispute is resolved. 

Ottawa is proposing to exclude Canadian retailers – main sellers of U.S. dairy merchandise like cheese – in Canada.

Vilsack, talking to Agri-Pulse after he met with Canadian Agriculture Minister Marie-Claude Bibeau on the sidelines of a G7 summit of ministers in Germany this weekend, confused that “there is a need for Canada to make a much better effort than they’re making right now.”

A 3-member USMCA dispute panel agreed in December that Canada was manipulating its dairy quotas. Canada then agreed to alter its quotas that had been initially supposed to enhance U.S. entry to Canada’s marketplace for milk, cheese, cream, skim milk powder, butter, ice cream and whey.

Canada revealed its first proposal in response to the panel’s ruling in March, and it was rapidly rejected by the U.S. authorities, U.S. dairy teams and even some Canadian importers who needed extra entry to U.S. cheese and different merchandise.

Industry insiders have been speculating that Global Affairs Canada had completed and submitted to the U.S. a second proposal to fix the quotas, but it surely has not been made public.

Vilsack confirmed Saturday that he was talking in response to that second proposal and confused that he conveyed his objections to Bibeau  final week and once more on Saturday.

“I very forcefully conveyed our significant disappointment in the response to the panel’s discussion under USMCA on the issue of whether or not Canada would open up the TRQ under USMCA for dairy to include their retailers,” Vilsack mentioned.

The exclusion of Canadian retailers from Canada’s dairy quota system – in each the quotas arrange by Canada after USMCA was carried out and within the first proposal revealed earlier this yr – was the supply of a key objections by U.S. dairy teams just like the National Milk Producers Federation and the U.S. Dairy Export Council.

The March proposal out of Global Affairs Canada would have altered the cheese quota to give 100% of the allocation to processors and distributors whereas not together with Canadian retailers. The unpublished second proposal would proceed to omit retailers from the quota, in accordance to Vilsack.

The core drawback with the Canadian proposals, says Jaime Castaneda, government vice chairman of the National Milk Producers Federation and the U.S. Dairy Export Council, is that Canada is giving an unfair benefit to its highly effective dairy processors.

 “Canada made a clear choice to thumb its nose at both the United States government and its international treaty obligations,” says NMPF President and CEO Jim Mulhern. “It has completely disregarded the USMCA agreement signed just a few short years ago.”

NMPF and USDEC instructed Agri-Pulse in a press release that they’re calling on the Biden administration “to levy retaliatory tariffs on Canada after Ottawa made clear that it refuses to meet its signed treaty obligations under the UMCA concerning dairy market access.”

 

 

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