During a trip to Wisconsin, the No. 2 dairy state, President Trump said, “We’re going to get the solution” in a dispute with Canada over the price of a high-protein milk concentrate called ultrafiltered milk that’s used in making cheese. “We’re going to work on it immediately—in fact, starting today,” Trump said in a speech at the Snap-On tool plant in Kenosha.
“The fact is, NAFTA has been a disaster for the United States—a complete and total disaster,” said the president, who has aimed most of his complaints about the North American Free Trade Agreement at Mexico. “And we’re going to do some things,” he said, a reference to a campaign pledge to either rewrite NAFTA or abandon it. Still, he gave no suggestion of when renegotiations might begin. “Cannot continue like this, believe me,” said Trump, drawing applause from the factory workers.
U.S. dairy groups say Canada’s new Class 7 pricing program, implemented on Feb. 1, unfairly and dramatically reduced the price of ultrafiltered milk produced domestically, to the detriment of U.S. sales. Imports from the United States were initially duty-free, but the government changed the rules after complaints from dairy farmers in Ontario. Dairy is a long-standing area of disagreement between the countries because of Canadian tariffs on many dairy products. The Washington Post published a front-page story on ultrafiltered milk hours before President Trump flew to Wisconsin.
“We’re going to stand up for our dairy farmers in Wisconsin—and I’ve been reading about it and I’ve been talking about it for a long time—and that demands, really, immediately, fair trade with all of our partners, and that includes Canada,” said Trump. “We’re going to call Canada, and we’re going to say, ‘What happened?’ And they might give us an answer, but we’re going to get the solution, not just the answer, okay? Because we all know what the answer is, all right?”
Canada is trying to stifle U.S. competition, said the National Milk Producers Federation, thanking Trump for speaking out. “Canada’s repeated disregard for its dairy trade commitments to the United States has left American dairy farmers enduring the severe and unfair consequences.”
According to the CBC, “About 70 dairy producers in both Wisconsin and New York are affected by the new rules, and have lobbied the U.S. government for action on the file. … The Dairy Farmers of Canada said it was confident the federal government would continue to defend the dairy industry.” Canada is the No. 2 customer for U.S. farm exports.
In a letter to the president last week, American dairy groups said the administration should demand an end to Class 7 pricing and the restoration of imports of U.S. ultrafiltered milk, and “make opening Canadian dairy market access and addressing the chronic use of nontariff tools to thwart trade a key and early-stage priority in NAFTA discussions.” If Canada won’t agree, said the groups, the United States should file a WTO complaint accusing Canada of blocking trade and dumping dairy products on the world market.
Three Canadian ministers, holding portfolios for transport, environment, and heritage, are in the United States this week, said the CBC, “to lobby American leaders and lawmakers about the importance of maintaining unfettered trade between the two countries.”`