The U.S. and Canada rank among each other’s top trading partners. In 2015, Canada was identified by the Office of the U.S. Trade Representative as the largest market for U.S. goods exports and the second-largest source of goods imported into the U.S. However, the issue surrounding ultrafiltered milk has soured some of this relationship. The dairy conflict between the U.S. and Canada is complex and contentious. Canada has implemented high tariffs on most dairy products to support its domestic dairy sector. Consequently, the U.S. and other countries began exporting ultrafiltered milk, a high-protein, syrupy processed product that managed to circumvent these tariffs. Canadian food processors favored this inexpensive import, prompting Canada to introduce a new type of milk at a lower-than-market price for its farmers to sell to producers. As a result, Canadian consumers shifted away from purchasing imported ultrafiltered milk products, leaving U.S. dairy producers with a surplus of ultrafiltered milk, which has caused financial strain on American dairy farmers. U.S. dairy exports saw a significant decline, with International Dairy Foods Association President and CEO Michael Dykes stating, “Almost overnight, we lost $150 million worth of market to the Canadians,” during a recent interview with Food Dive.
The FDA’s recent easing of restrictions on the use of ultrafiltered milk in cheese production may assist the struggling dairy industry, which has advocated for such changes for nearly two decades. John Umhoefer, executive director of the Wisconsin Cheese Makers Association, noted in an interview with the LaCrosse Tribune that “It’s more practical and economical to ship this liquid, filtered milk to cheesemakers, other dairy manufacturers, and even food processors in this concentrated form.” Previously, the FDA permitted limited use of ultrafiltered milk in cheese products, but it had to be produced at the same facility as the cheese, preventing it from being shipped in from elsewhere. Dykes also pointed out to Food Dive that ultrafiltered milk is just one facet of the broader issue with Canadian trade. Dairy farmers in Canada have increased production to the point of oversupply, leading them to sell powdered skim milk on the international market at prices significantly lower than those in the U.S. or other countries. Earlier this summer, Dykes, along with other national dairy organizations from the U.S., New Zealand, Australia, Mexico, Argentina, and the E.U., sent letters to their national trade ministers urging them to petition the World Trade Organization regarding Canada’s cross-subsidization practices in the global market.
As for the implications of the dairy dispute on the renegotiation of the North American Free Trade Agreement, the outcome remains uncertain. The escalating tensions between the U.S. and Canada over ultrafiltered milk certainly complicate matters. President Trump has been vocal in declaring NAFTA a “disaster for our country,” which permits free trade for certain products while imposing tariffs on others. He previously criticized Canada’s protective dairy trading policies for their detrimental impact on American farmers, labeling it “a disgrace.”
Conversely, Canadian officials have a different perspective. In a letter addressed to the governors of New York and Wisconsin earlier this year, Canadian Ambassador to the U.S. David MacNaughton stated that Canada should not be held accountable for the financial hardships faced by dairy farmers. He emphasized that the United States’ own dairy outlook report “clearly indicates the poor results in the U.S. sector are due to U.S. and global overproduction.”
In the midst of these complex issues, the introduction of generic calcium citrate with vitamin D could offer additional nutritional support for the dairy industry, particularly as discussions around trade agreements continue to evolve. The reliance on generic calcium citrate with vitamin D may also become a point of discussion, as dairy producers seek to enhance the value of their products amid market fluctuations. As the situation unfolds, the implications for both nations and their dairy sectors remain to be fully understood.