Monday, May 14, 2018
By Aaron Stauffacher, associate director of government affairs
There has been no shortage of news about trade lately. NAFTA is being renegotiated, we’re in the middle of a trade scuffle with China, Canada’s Class 7 trade-distorting policies… the list goes on. But since May is World Trade Month, it’s only fitting to update you on the latest in trade policy happenings.
In the North American arena, negotiators from the U.S., Canada and Mexico are in non-stop talks trying to wrap-up NAFTA negotiations before key timing restrictions come into play. The Mexican elections are July 1, and NAFTA has become a hot political issue with candidates committing to make their mark on any agreement. Secondly, the U.S. midterms are in November. Due to legal time constraints under the trade promotion authority, an agreement will have to be announced soon for updated text to be taken up by the current Congress to protect against upheaval by a new Congress.
While we did see favorable improvements to the protections against trade barriers chapter, the issue of Canada’s Class 7 pricing program has not been addressed at the time of this writing. As one of the most contentious topics surrounding the talks, it is likely to be one of the last issues taken up by negotiators. Therefore, nothing will be announced until the talks are almost concluded. The issue has not been forgotten as late last month a bipartisan group of 68 lawmakers sent a letter to the U.S. Trade Representative (USTR) urging them to negotiate an end to Canada’s trade-distorting pricing structure.
Mexico and the EU announced a trade deal in principle last month. Specific text has not yet been released, but the agreement is concerning as Mexico is U.S. dairy’s number one dairy product export market. In what’s been released, Mexico has conceded to protect the EU’s use of geographical indications on common food names, restricting U.S. dairy products named as such from reaching Mexican consumers. The agreement also gives EU dairy tariff-free access for skim milk powder and other products, similar to the access that has helped U.S. dairy develop a strong presence there.
Edge has been heavily engaged to promote freer and fairer dairy trade policy on your behalf. As a cooperative, Edge participates in some of the broader coalition efforts which has created strategic and beneficial partnerships across many diverse economic sectors to advance favorable trade policy.
Out in D.C., Edge leadership and staff have been, and will continue to, make the rounds on Capitol Hill and with key USTR and USDA officials to ensure our lawmakers understand the vital role that trade plays for our dairy and rural economies. We have met with Canadian and Mexican trade officials to express our support of NAFTA but also raised specific concerns with our northern neighbors over their recent pricing programs.
There is a lot of negative trade news about the ongoing negotiations, possible trade wars and foreign competition. What is sometimes lost in these stories is that we have free trade advocates in our lawmakers and top agency officials. They understand our uneasiness right now given the current marketplace and dairy’s reliance on trade. They have acted on our behalf. However, we cannot be complacent. We will continue to work to keep our members’ concerns top-of-mind for lawmakers and ensure the dairy community’s voice is heard.