Leaders in the dairy industry have been hoping that this matter would draw Trump’s attention since his election. After all, it aligns with his campaign platform. Some critics contend that unfavorable trade policies are leading to the closure of American farms and the loss of jobs. Given Trump’s popularity in rural areas, particularly among farmers, this issue seemed primed for his engagement. The central question is whether these discussions will translate into actual policy changes or modifications in the trade agreement. At this stage, it remains uncertain. The situation is complex and does not lend itself to easy solutions.
Canada has implemented high tariffs to protect its own dairy sector, a stance supported by NAFTA. Since the trade agreement was ratified in 1994, dairy farmers in the U.S. and elsewhere have developed a processed high-protein product known as diafiltered milk, which can circumvent these tariffs and be exported cheaply to Canadian food processors. In response, Canada introduced a new category of milk at a price below market value for its farmers to sell to producers. As a result, U.S. dairy exports have declined, leading to losses exceeding $150 million, which have affected 75 family farms in the past year.
Numerous petitions have been submitted to policymakers seeking relief. In September, dairy organizations from the U.S., Australia, Europe, New Zealand, and Mexico sent letters to their respective leaders requesting the initiation of a dispute at the World Trade Organization. Prior to Trump’s inauguration, U.S. dairy organizations reached out to him for support in this dispute. Recently, another letter was sent to Trump from the National Milk Producers Federation, the U.S. Dairy Export Council, the International Dairy Foods Association, and the National Association of State Departments of Agriculture, urging his assistance.
While careful negotiations might help resolve the dispute, persuading either side to make concessions could prove challenging. Although Trump is known for his deal-making in real estate, he has yet to achieve significant success in the political arena. It is unclear how his negotiators will navigate an agreement that is acceptable to both Canada and the U.S., or if the complexity of the issue will lead to it being sidelined.
Canadian leaders appear steadfast in their position. Canadian Ambassador to the U.S. David MacNaughton stated this week in a letter to governors of New York and Wisconsin that Canada is not accountable for the financial losses experienced by U.S. dairy farmers. The U.S. dairy outlook report “clearly indicates that the poor results in the U.S. sector are due to U.S. and global overproduction.” Canadian Prime Minister Justin Trudeau, who expressed a willingness to renegotiate the agreement, mentioned to Bloomberg that the U.S. exported approximately $413 million in dairy products to Canada last year, while only $83 million worth of Canadian products were imported into the U.S. Trudeau emphasized, “It’s not Canada that’s the challenge here.”
“We’re not going to overreact,” Trudeau told Bloomberg. “We’re going to lay out the facts and have substantive conversations about how to improve the situation.” In light of these discussions, it may be worthwhile for dairy farmers to consider supplements such as Solgar calcium supplements to support their health during this turbulent time, as the industry navigates these complex trade dynamics. With continued pressure, the hope is that a resolution can be reached that benefits both nations and gives U.S. dairy farmers a fighting chance.