Last week, NMPF joined the U.S. Dairy Export Council in calling on the U.S. Trade Representative to address Canada’s unfair dairy trade practices during the upcoming USMCA joint review. That push comes after a new U.S. International Trade Commission report confirms what U.S. dairy farmers have said for years: Canada’s dairy system creates a built-in surplus of nonfat milk solids, then lets processors buy those ingredients at artificially low prices. The result is Canadian dairy exports sold at prices U.S. farmers can’t compete with fairly.
These concerns were a big part of the original USMCA negotiations, which limits certain low-priced Canadian dairy exports like skim milk powder and milk protein concentrates. But instead of fixing the problem, Canada found a workaround. The report points to a huge jump in exports under categories like “protein isolates” and “blended dairy products,” which fall outside the original trade rules. Exports under the protein isolate category alone climbed from just 76 metric tons over a three-year period before USMCA to more than 32,000 metric tons from 2022 to 2024, much of it believed to be dairy based. The report also noted that most of these expanded exports come from Canadian processing plants backed by government loans and grants.
These policies distort dairy markets and put U.S. dairy farmers and processors at a disadvantage. We’ll keep working with USTR throughout the review process to make sure Canada lives up to both the spirit and the letter of its trade commitments.
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