Canada stood fast in defense of its supply management system for dairy, and Mexico rejected a U.S. proposal for sanctions on seasonal surges in produce shipments during an inconclusive round of NAFTA talks in Mexico City. For the second time, negotiations are at an impasse over the new NAFTA, and Canada’s foreign minister said her country is prepared for a U.S. withdrawal.
Minister Chrystia Freeland said the United States has presented “extreme proposals” on issues that include dairy, reported the Canadian news site iPolitics. “Canada is certainly prepared for every eventuality,” Freeland replied to a question about her government’s contingency plans. “As I’ve said, we want a good deal, not just any deal.” President Trump has repeatedly threatened to abandon the tri-national trade pact, worrying U.S. farm groups.
U.S. negotiators proposed a 10-year phase-out of the Canadian supply management system, which limits imports and assures producers of a minimum price; critics say it drives up food costs. Jeff Leal, provincial agriculture minister in Ontario, said elimination of supply management was “outrageous” and a “non-starter” during a conference call from Mexico City early this week, said Farms.com.
Produce growers in the U.S. Southeast have pushed for stronger protection against shipments from Mexico, which they say are sold at artificially low prices. A textile executive, Moises Kalach, who represents Mexico’s private sector at the talks, said his country rejected the U.S. proposal for new seasonal restrictions on produce, said the New York Times.
“One thing the Mexican sources are adamant about — if Trump makes good on his threat to start the NAFTA cancellation process as a bargaining ploy, they will refuse to negotiate under that pressure and would rather let the U.S. withdraw,” said the National Post, a Canadian newspaper. Mexico would cancel NAFTA trade terms, meaning U.S. farm exports would face tariffs instead of duty-free entry, and it would speed up trade negotiations with other nations, said the National Post. “Canada has not drawn such a hard line.”
Canada and Mexico account for one-third of U.S. agricultural trade.
The sixth round of talks is scheduled for late January in Canada.
To see a set of American Farm Bureau Federation maps showing NAFTA’s importance to the ag sector in each state, click here.