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Canadian Plan for USMCA Compliance a ‘Nonstarter’

On March 2nd, the Government of Canada published its plans for complying with U.S. Mexico-Canada Agreement (USMCA) tariff-rate quota (TRQ) commitments after a USMCA dispute panel found them non-compliant in January.

Michael Dykes, D.V.M., president and CEO of the International Dairy Foods Association (IDFA), said the Canadian plan is a nonstarter. “The plan makes true access to the Canadian market unattainable through a series of gimmicks. It comes as no surprise that Canada is unwilling to reform their trade-distorting practices on dairy.”

The plan makes minimal changes and continues to fall well short of Canada’s USMCA commitments, adding distributors as eligible applicants and allocating based on market share. IDFA remains deeply concerned that these proposed changes will continue to have the same outcome as the previous policy and market access will not be obtained.

From the onset of USMCA implementation, IDFA has sought the reform of Canada’s TRQ administration by seeking an administration that does not have layers of overly prescriptive rules that distort the market and prevents U.S. dairy exporters from having full access to the quotas Canada agreed to in the USMCA. Canada’s announced consultations on Wednesday fall well short of true reform.

IDFA will continue advocating for Canadian TRQ administration reform that facilitates the market access commitments in the USMCA Agreement and will continue collaborating with the U.S. Government to support their negotiation of an acceptable outcome for the USMCA TRQ dispute.

“We continue to support our U.S. Government colleagues in ensuring Canada is fully meeting all of its commitments under USMCA,” said Dykes.

The International Dairy Foods Association (IDFA), Washington, D.C., represents the nation’s dairy manufacturing and marketing industry, which supports more than 3.3 million jobs that generate $41.6 billion in direct wages and $753 billion in overall economic impact. IDFA’s diverse membership ranges from multinational organizations to single-plant companies, from dairy companies and cooperatives to food retailers and suppliers, all on the cutting edge of innovation and sustainable business practices. Together, they represent 90 percent of the milk, cheese, ice cream, yogurt and cultured products, and dairy ingredients produced and marketed in the United States and sold throughout the world. Delicious, safe and nutritious, dairy foods offer unparalleled health and consumer benefits to people of all ages.

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