Dairy Farmers want U.S. trade policy to focus on opening markets and fending off competition from the European Union and New Zealand.
U.S. dairy exports were up about 10% in the first half of 2020 compared to last year. But that’s not enough to return the sector to profitability, according to dairy farmers and producers that are participating in a series of virtual town hall meetings on trade issues.
“America's dairy future growth is really tied to the success of global markets," said Jim Mulhern, president and CEO of the National Milk Producers Federation.
Dairy industry leaders want the next president, regardless of whether it’s Donald Trump or Joe Biden, to promote a trade policy that seeks bilateral trade deals with countries that will keep U.S. milk and cheese competitive.
“Any market you look at, the EU or New Zealand, has better tariff advantages than we do. We need a focus from U.S. trade policy that is designed to create that level playing field,” Mulhern said.
The issue is tariffs, according to Jeff Schwager, CEO of Sartori Cheese, based in Plymouth, Wisconsin.
“For the cheese we ship to Europe, we pay more in duty per kilogram than the Europeans pay to export their cheese to the United States. What’s fair in that?” Schwager said.
Dairy farmers do give credit to the Trump administration for the U.S.-Mexico-Canada Agreement (USMCA), which replaced the expired North American Free Trade Agreement (NAFTA). That deal is expected to increase dairy sales to Canada by more than $200 million annually.
But the deal doesn’t go far enough for some dairy interests.
“USMCA is an improvement, but we are still at a disadvantage in Canada with the import limitation on U.S. cheese,” Schwager said. “They have a bilateral trade agreement with the EU that is more favorable for cheese than with us, their closest neighbor.”
Some congress members are siding with the dairy industry on that topic. Twenty-five senators and more than 100 representatives have sent bipartisan letters asking the Trump administration to start holding Canada and Mexico up to their parts of the deal on dairy.
Exports currently make up 15-17% of U.S. dairy production.
Follow Jonathan on Twitter: @JonathanAhl