IDFA to Urge USTR to Preserve USMCA and Correct Violations of Key Dairy Provisions

The International Dairy Foods Association (IDFA) will testify before the Office of the U.S. Trade Representative (USTR) this afternoon during a public hearing on the operation of the U.S.-Mexico-Canada Agreement (USMCA). Becky Rasdall Vargas, senior vice president for trade and workforce policy at IDFA, will call on U.S. negotiators to preserve the benefits of USMCA while rectifying violations and operational challenges.

“USMCA is critical to U.S. dairy’s success, with Mexico and Canada accounting for 44% of all U.S. dairy exports—about $3.6 billion annually,” Rasdall Vargas will say in her prepared remarks. “Yet longstanding issues such as Canada’s dairy tariff rate quota administration and its implementation of USMCA dairy pricing provisions limit U.S. exporter’s ability to fulfill the promises of the USMCA agreement. IDFA urges the U.S. government to maintain the agreement’s positive elements, build on its progress, and correct violations that have plagued U.S. dairy exporters since USMCA’s entry into force.”

The hearing marks the start of USTR’s first comprehensive review of USMCA, which entered into force in 2020 and requires a joint evaluation among the United States, Mexico, and Canada after six years to determine whether to extend the trade pact for another 16 years. The review process is designed to assess the Agreement’s operation, address compliance issues, and ensure that the framework continues to promote fair, rules-based trade across North America.

In her testimony, Rasdall Vargas will emphasize that Canada’s failure to meet its obligations under USMCA remains the most significant challenge facing U.S. dairy exporters. She will reiterate that Canada’s restrictive tariff-rate quota administration continues to disadvantage U.S. suppliers, and that its milk pricing practices—despite commitments made in the USMCA agreement—still function in ways that distort markets. These issues, she will note, have affected U.S. exporters since the Agreement’s entry into force and should be addressed during the review to restore confidence in the rules-based system USMCA was designed to uphold.

In addition to Rasdall Vargas’s oral remarks, IDFA submitted more detailed written comments to USTR in November, providing further recommendations for strengthening enforcement mechanisms, modernizing specific USMCA chapters, and addressing operational shortcomings that have limited the Agreement’s effectiveness. IDFA also continues to provide USTR with ongoing feedback related to U.S. dairy’s concerns with USMCA and participate in coalitions aimed at preserving a trade agreement within North America.

Rasdall Vargas will conclude her testimony by underscoring that the six-year review presents a significant opportunity to build upon the success of USMCA while ensuring that all parties meet their commitments. “We look forward to supporting negotiators in developing a renewed, modernized, and corrected USMCA that can serve as a reliable tool for exporters and that opens the door for new and improved trading relationships between the parties,” she said.

To read Rasdall Vargas’s oral testimony as prepared, visit here.