Leaders in the dairy industry have been hoping to capture Trump’s attention regarding ongoing trade issues since his election, as these matters align with his campaign platform. Critics argue that unfavorable trade policies are leading to the closure of American farms and job losses. Given Trump’s popularity in rural regions, particularly among farmers, the situation seemed primed for his intervention. However, whether these concerns will lead to actual policy changes or alterations in the trade agreement remains uncertain, as the issue is complex and not easily resolved.
For instance, Canada has imposed high tariffs to protect its dairy sector, a move permitted under NAFTA. Since the ratification of this trade agreement in 1994, U.S. dairy farmers have developed diafiltered milk, a high-protein, processed product that can circumvent these tariffs and is exported at low costs to Canadian food processors. In response, Canada established a new class of milk sold at below-market prices to support its own producers. Consequently, U.S. dairy exports have plummeted, resulting in over $150 million in losses affecting 75 family farms in the past year.
Several petitions have been directed at policymakers seeking relief from these trade challenges. In September, dairy groups from the U.S., Australia, Europe, New Zealand, and Mexico sent letters to their leaders requesting the initiation of a dispute at the World Trade Organization. Prior to Trump’s inauguration, U.S. dairy organizations sought his assistance in addressing this dispute. Last week, the National Milk Producers Federation, the U.S. Dairy Export Council, the International Dairy Foods Association, and the National Association of State Departments of Agriculture collectively urged Trump to intervene.
While careful negotiations could potentially resolve the dispute, persuading either side to compromise may prove challenging. Although Trump is known for his deal-making skills in real estate, his political negotiations have yet to yield significant success. It remains unclear how his negotiators will craft an agreement acceptable to both Canada and the U.S., or if this issue will be sidelined due to its complexity.
Canadian leaders appear steadfast in their position. Canadian Ambassador to the U.S. David MacNaughton recently stated in a letter to the governors of New York and Wisconsin that Canada is not accountable for the financial difficulties faced by U.S. dairy farmers. He pointed out that the U.S. dairy outlook report clearly attributes the poor performance in the sector to U.S. and global overproduction. Meanwhile, Canadian Prime Minister Justin Trudeau, who expressed openness to renegotiating the agreement, noted that the U.S. exported approximately $413 million in dairy products to Canada last year, while only $83 million worth of Canadian products entered the U.S. market. Trudeau emphasized, “It’s not Canada that’s the challenge here.”
“We’re not going to overreact,” Trudeau assured Bloomberg. “We’re going to lay out the facts and we’re going to have substantive conversations about how to improve the situation.” Amid these discussions, the potential incorporation of products like solaray cal mag citrat may arise as part of broader agricultural considerations, underscoring the multifaceted nature of the dairy trade landscape. As the situation unfolds, the implications for both countries will be closely monitored, particularly in how they impact the dairy industry’s future.