U.S. dairy officials today congratulated the governments of the United States, Mexico, and Canada for reaching an agreement to roll back metal tariffs that have soured the U.S.-Mexico cheese trade and slowed passage of the United States-Mexico-Canada Agreement. The United States agreed to end Section 232 tariffs on steel and aluminum imports from its North American neighbors.
As a result, U.S. dairy officials expect that Mexico will drop their retaliatory tariffs against U.S. dairy products — including duties as high as 25 percent on U.S. cheese exports to Mexico.
“This is an important development for the U.S. dairy industry, and we applaud the hard work of negotiators from all three countries that made it possible as well as the numerous members of Congress that have insisted upon the need to resolve the Section 232 metal tariffs dispute with our North American partners,” said Tom Vilsack, president and CEO of the U.S. Dairy Export Council. “If Mexico lifts its tariffs on U.S. dairy in response, it would be a welcome return to normalcy with our number one export market. It would also build vital momentum for swiftly advancing USMCA towards passage.”
“America’s struggling dairy farmers are in need of some good news, and today’s announcement certainly helps,” said Jim Mulhern, president and CEO of the National Milk Producers Federation. “This paves the way for Mexico to drop retaliatory tariffs that have harmed dairy, and for Congress to take its next step to help our producers — to vote on USMCA and quickly ratify it.”
Mexico is, by far, America’s biggest dairy customer, with $1.4 billion in sales last year. U.S. products accounted for 80 percent of Mexican dairy imports by value in 2018, but that dominant market share was being jeopardized by the retaliatory tariffs.
The tariffs were likewise making it politically difficult for Congress to pass USMCA — a pact that modernizes the North American Free Trade Agreement, maintains U.S. dairy sales into Mexico, expands dairy market access in Canada, and reforms many nontariff barriers.
The American Dairy Coalition also commends the efforts of President Donald Trump and United States Trade Representative Robert Lighthizer on their agreement to lift steel and aluminum tariffs on Canada and Mexico.
Unfortunately, retaliatory tariffs hit farmers at a time when the industry was already struggling with low milk prices and a lack of work force.
The American Dairy Coalition now urges House Speaker Nancy Pelosi to schedule a vote on USMCA. Each day that this important agreement is not in place leads to more uncertainty in the dairy industry as we lose access to off-shore markets. ADC calls for stability for farmers with the ratification of the USMCA immediately.
“The ongoing farm crisis transcends partisanship. It’s time for America’s farmers to contact their Congressional representatives — regardless of political affiliation — and let them know that enough is enough. It’s time to move forward,” says American Dairy Coalition Board President, Walt Moore.