Dairy leaders from the U.S. and Mexico issued a list of priorities, including repeating previous criticism of European Union (EU) and Canadian dairy trade policies, as North American Free Trade Agreement (NAFTA) talks get set to resume Sept. 1-5, in Mexico City.
The first round of NAFTA discussions, held in Washington, D.C., ended Aug. 20. A third round is scheduled in Canada in late September, with the fourth round returning to the U.S. in October.
Separate from NAFTA negotiations, members of the U.S.-Mexico Dairy Alliance met on Aug. 24 in Guadalajara, Mexico, to discuss mutual dairy trade concerns. The alliance was created a year ago following a two-day meeting in Denver, Colorado.
This year, the meeting focus was on expanding areas of collaboration while preserving current trade established under NAFTA. The alliance sees NAFTA as the foundation of the U.S.-Mexico dairy industries’ mutually beneficial free-trade relationship. Enacted in 1992, it removed barriers to trade and has led to more than a six-fold increase in U.S. dairy exports to Mexico, equivalent to $1.2 billion in 2016.
The U.S. dairy industry was represented by the U.S. Dairy Export Council (USDEC) and the National Milk Producers Federation (NMPF). Mexican dairy producer organizations included the Confederación Nacional de Organizaciones Ganaderas, Gremio de Productores Lechero de la República Mexicana and the Asociación Nacional de Ganaderos Lecheros, along with Mexican processor organization Camara Nacional de Industriales de la Leche.
“We want to strengthen our relationship as Mexico’s most trusted dairy-trading partner so we can continue to work together for the benefit of dairy sectors on both sides of the border,” said USDEC President and CEO, Tom Vilsack. “That goal is all the more essential given other nations’ efforts to pursue harmful and disruptive approaches to dairy trade with Mexico through practices that hurt Mexican and U.S. dairy farmers and workers in the process.”
Jim Mulhern, president and CEO of NMPF, said, “We are very pleased that our friends in Mexico have joined us in expressing opposition to the abusive attempts of the European Union to confiscate common food names, as well as the trade-distorting practices of Canada, at a time when we are working to facilitate new opportunities throughout North America.”
Vilsack and Mulhern charged that, in contrast to Mexico’s open trade approach, Canada has retained high dairy tariffs and implemented policies that hinder free trade between North American neighbors. Canada’s new Class 6/7 pricing policy has drawn strong concerns of both the U.S. and Mexico, and was a significant point of discussion at the meeting on Aug. 24.
Priorities listed
On Aug. 28, alliance members released a unified list of nine priorities that includes modernizing NAFTA to solidify their strong dairy market partnership, while addressing concerns about Canadian and European dairy policies.
Among the list of priorities, U.S. and Mexico dairy leaders said European Union (EU) is seeking, through direct negotiations with Mexico, to impose new barriers to dairy trade through the enforcement of geographical indications. This is a significant concern to U.S. and Mexican cheesemakers because it would give the EU exclusive use of common cheese names like asiago, gorgonzola and feta.
The leaders also said Canada is disrupting dairy trade in North America and beyond with its new Class 6/7 pricing scheme, which they said displaces U.S. exports and global milk powder markets.
Other priorities include establishment of a working group to analyze steps to implement application of U.S. Grade A milk standards to industries in both nations; resolve differences in sanitary and scientific standards to facilitate trade of raw milk for processing purposes between both countries; work to strengthen exchange of technologies covering milk production, quality and nutrition; and work to promote dairy product consumption in Mexico.
Vilsack said the meeting “illustrates how our industries are committed to seeing our relationship continue to flourish and to jointly rejecting unjustified barriers to dairy trade.”
Meanwhile, the head of the International Dairy Foods Association (IDFA) said the U.S. dairy processor organization will continue to push similar priorities as NAFTA talks move forward. Michael Dykes, IDFA president and CEO, is the dairy processor representative on the U.S. Agricultural Policy Advisory Committee.
Maintaining the U.S. dairy industry’s export market in Mexico is the top priority for IDFA. IDFA also continues to call for negotiators to address Canada’s milk pricing policies, and seek to eliminate tariffs and to seek greater U.S. dairy market access to Canada. 
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Dave Natzke
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