U.S. Amping up Dispute With Canada Over Allowed Exports of American Dairy Products

May 25, 2021 Updated: May 25, 2021

WASHINGTON—The United States is escalating its dispute with Canada over the sale of American dairy products north of the border.

The U.S. Trade Representative’s office says it wants a dispute settlement panel to examine whether Canada is unfairly keeping American producers from accessing the Canadian market.

The request is a significant ramp-up of American complaints about the way Canada is allocating access to the market under the U.S.-Mexico-Canada Agreement.

The U.S. is upset with how Canada is distributing its tariff-rate quotas—the quantities of certain dairy products that can be imported at lower duty levels.

The USTR says a large share of those quotas have been allocated to processors rather than producers, effectively denying U.S. farmers their fair share of the supply-managed Canadian market.

Canadian officials, however, insist that the allocations are perfectly in keeping with its commitments under the trade agreement, which took effect last July.