U.S. Agriculture Chief Says Canada Must Make Concessions on Dairy Policy for NAFTA Deal

September 9, 2018 Updated: September 9, 2018

Canada must end its low-price milk proteins policy to reach a U.S.–Canadian deal to update the North American Free Trade Agreement, U.S. Agriculture Secretary Sonny Perdue said.

Canada has encouraged overproduction and flooded export markets for milk proteins used in cheese and yogurt, hurting U.S. dairy farmers, Perdue said in an interview aired on Sept. 9 on C-SPAN television.

“Our farmers don’t have access to the Canadian markets the way that they have access to us. Class 7 has to go. It can’t be renamed something or called something else,” Perdue said, when asked about dairy concessions needed to reach a NAFTA deal, referring to a new milk class created last year by Canada to price milk ingredients such as protein concentrates, skim milk and whole milk powder.

“It allowed them to export milk solids on the world market and below prices that cut into our opportunity for our dairy people to have access to that world market,” Perdue said.

Canada’s closed, $16 billion dairy market is among the last sticking points in talks between U.S. Trade Representative Robert Lighthizer and Canadian Foreign Minister Chrystia Freeland, which broke up Sept. 7 without a deal.

Talks are expected to resume after Lighthizer travels to Brussels for trade talks with European Union trade commissioner Cecilia Malmstrom on Sept 10.

A spokesman for Freeland couldn’t immediately be reached for comment on Perdue’s remarks.

White House economic adviser Larry Kudlow last week said milk was the main issue standing in the way of a NAFTA deal.

In an interview with Canada’s Global News network published Sept. 9, Freeland declined to discuss specific issues in the talks and noted that Kudlow is “not at the negotiating table.” Freeland added that to achieve a NAFTA deal, “It’s going to take flexibility on all sides.”

By David Lawder

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