Washington’s dairy farmers need NAFTA

The Washington state dairy industry contributes nearly US$4 billion a year to the state’s economy and provides more than 18,800 jobs.

In fact, dairy is part of a booming food and agriculture sector that creates more than 736,700 jobs and provides a $69 billion economic stimulus to the state.

But a U.S. withdrawal from the North American Free Trade Agreement and other free trade agreements puts this economic sector at risk.

Nationwide, U.S. dairy companies employ nearly one million skilled individuals and generate more than $39 billion in wages. With demand for nutritious dairy products globally on the rise and the capacity here at home to sustainably expand production, free-trade agreements are crucial to a thriving U.S. dairy industry and adding thousands more American jobs.

I strongly support efforts to modernize NAFTA. It must continue to provide duty-free access to Mexico, our largest foreign market, and we must gain access to Canada’s dairy market, which was excluded from NAFTA when it was first negotiated nearly a quarter century ago.

In Mexico alone, the United States is the dominant dairy supplier, capturing close to 75 percent of that market. Dairy exports to Mexico support nearly 30,000 American jobs.

In Canada, not only do U.S. dairy exports face extremely high tariffs, but Canada has recently created a new pricing policy that keeps domestic consumer dairy prices high, while simultaneously undermining global markets for dairy ingredients, and exporting those ingredients far below the prevailing world price.

This not only keeps Washington and other U.S. dairy products out of Canada, it has effectively blocked some U.S. dairy exports to other markets around the world. NAFTA negotiations present an opportunity to stop these unfair practices.

A proactive global trade agenda is an economic imperative. As the United States focuses solely on NAFTA, other countries are aggressively forging new trade deals, both bilaterally and multilaterally, with the new Trans-Pacific Partnership going ahead without us. These agreements provide our competitors access to consumers in a fast-growing middle class that should be our natural market.

The completion of the free-trade agreement between Japan and the European Union is an example of falling behind, with the new TPP deal simply the latest in a string of setbacks.

Meanwhile, the European Union, as well as Australia and New Zealand, are expanding their global reach through negotiations with Canada and Vietnam, and the Pacific Alliance.

U.S. dairy and agribusiness are the most competitive in the world, but that does America little good if we continue to face high tariffs and a range of non-tariff barriers designed to keep our products out of international markets. U.S. trade negotiators are able and working hard on NAFTA, but I urge them to aggressively and simultaneously pursue a level playing field for U.S. dairy products and agriculture everywhere else.

Stan Ryan is president of Darigold Inc., a Seattle-based dairy co-operative owned by nearly 500 dairy farm members. This article was originally published in the Seattle Times.

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Comments

  • Bruce

    The United States needs access to the Canadian dairy industry. So they can ruin the quota system In Canada that works excellent for the dairy. Sorry Stan Ryan, our dairy industry does not need the United States dairy industry. You write the U.S. dairy industry is the most competitive in the world. Perhaps you may wish to add at ruining prices. Check with your own industry in Wisconsin. The dairy farmers there were in The Western Producer. The only reason for the poor prices they were complaining about was overproduction in the United States. Perhaps Stan Ryan instead of worrying about NAFTA you may wish to start a quota system for the dairy in the U.S. as Canada has.

  • Pro und Contra

    Not only Washington’s dairy farmers need NAFTA !

  • old grouchy

    Hmmmmmmmmmm – – – clearly someone with an ax to grind and quite the perspective.

    “In Canada, not only do U.S. dairy exports face extremely high tariffs,
    but Canada has recently created a new pricing policy that keeps domestic
    consumer dairy prices high, while simultaneously undermining global
    markets for dairy ingredients, and exporting those ingredients far below
    the prevailing world price.”
    Hmmmmmmmmmm – – -“. . . keeps domestic (Canadian) dairy prices high . . . ” – – – funny that – – – if you travel you will find that those Canadian dairy prices aren’t too terribly different from those in a lot of other places – – – like New Zealand and at least the western part of the EU. Now I can find real cheap dairy stuff in the US but that seemed to be the UHT stuff – – – that I wouldn’t feed to hogs – – – it tastes lightly charred and has a right weird mouth feel – – – so that points been thrashed.

    Next “. . . undermining global markets for dairy ingredients . . .” must be referring to the loophole in the import regulations used by some American processors that when it was clear that they were trying to bypass the intent of those same regulations, oh was there a mountain of whining when that loophole was closed.

    I tried to find comparable statistics but couldn’t so I used the total US production in # of milk and the average price of $3.29 per gal as a total value. That is going to be quite low because most milk products are quite a bit more valuable than straight milk but I can’t use what I can’t find!

    Canada USA
    dairy exports $335 million $ 17.7 billion
    diary production $ 4.8 billion $ 81.1 billion
    # of dairy cows 945 k 8.69 million

    So Canada exports about 0.7% (by value) of production.
    The USA exports about 21.8% (by value) of production.
    Canada’s dairy cow herd is about 10.9% of that of the USA.
    (standard arithmetic rounding rules were used)

    I’m having a hard time seeing where the Canadian exports are harming those of the USA.
    Is it perhaps that the US dairy industry feels that it should control the Canadian one?
    Seems like the only reason for a presentation like above – – – yes?

    As to the inability to access all foreign markets desired – – – – do all of these desired markets actually want the US dairy products? Perhaps someone might want to check on that too before more vitriol is flung using the present system (that information system reminds me quite a bit of a solid manure spreader in fact!).
    Maybe instead of crying that you can’t out cheap everyone in dairy products those self same processors might want to listen to their own customers – – – even I’m hearing them talk about how they want great products. Is that why cheese imports have increased (couldn’t easily find other milk product stats) 27% over the last 7 years (and 2017 is listed as 15% down from 2016!)?
    What I’m seeing is that the author above perhaps needs to travel a wee bit – – – get out and see the world, his urban neighborhood is a wee bit small IMO, his opinions – – – well they’re just a tad bit hard to justify when one looks at the facts but then when a bully is using rhetoric do facts matter?

  • Monkeeworks

    The Canadian dairy quota is there to guarantee the dairy farmer a monthly paycheque. No other farmer in Canada receives this benefit. Never mind that low income families cannot afford enough dairy for their families due to the artificial high prices produced by the quota system.

    • Bruce

      Other farmers, producers, such as poultry and eggs all receive a monthly paychegue. Or at least they can set up their income so as it works this way.

  • old grouchy

    As the Dairy Farmers of Canada support (and not just with words) milk in schools and more such your arguments are somewhat specious. If they cannot afford dairy then there are likely some other high value expenses.
    Myself I’ve watched persons coming to the food-bank. Some had newer vehicles than I do. Most of them seemed to smoke. The wacky hairdos were also common. Perhaps the high cost of living is more attributable to the cost of living high – – – or where one’s priorities are not where they could be. If you know anything about feeding yourself it is quite possible to live quite well on minimal amounts but it does take some participation. The desire for a handout is huge. The willingness to accept a handup is minimal. If persons insist on making a string of lousy choices I find it difficult to accept the ongoing demands for handouts.
    As the quota system was designed to provide the amount of good consumed in Canada by Canadian providers – – – I think it is generally a good thing.
    The ever increasing demand for handouts by those that are all too often refusing to help themselves, on the other hand, are not so appealing!

    • Harold

      What is your definition of a “hand up” and how do you think they got that way? Has your hand up in life always been attributed to those who freely passed along to you their truth and knowledge and from that you became successful and was it not only because you could fully understand it at the right timing in your life? Why do you think that they are making lousy choices; what compels them? I know that you have made a few lousy choices in life (we all do) and what compelled you to make them; a lack of truth and knowledge? A person that was well to do suddenly loses his job but it doesn’t sound unusual to find that person at the food bank because you can’t eat your house or your car and you eat daily and when will he get the next job? Most Canadians are two pay cheque’s from bankruptcy due to high debt accumulations and have a very hard time saving money because of the high costs of living including gasoline and energy/hydro, daycare and etc. Some are left with the option of heat or eat and they pay the heat and go to the food bank. Every one of those people who walk through those doors has very different reasons for being there and their reasons are not what a bystander may think with the stroke of a brush. As the old saying goes; you have to walk a mile in each of their shoes to understand. Perhaps you are seeing their smile and nature but are blind to the loss of their dignity that those smiles are trying to conceal. I do not have to go and stand in line at a food bank to understand how it may affect my dignity. Perhaps you should think of you standing in line the next time you are observing them because you are only living in a holiday from what could happen to you. There is another saying: only by the grace of god go I. You can go ahead and put your own meaning to it but the daily news will tell you something else. .
      Regarding the Canadian Dairy industry; number one and foremost is that every Canadian Job is protected because without this our economy and families suffer. It is absurd to think that we can flood another market that is already producing Dairy. It is also absurd to think that the USA owes us the loss of USA jobs because we want their market. The job of the Canadian dairy is to support all of those who wish to produce dairy but the Quota systems deny certain farmers that right to prosper. If there is a quota system it should be separate and a pool for the purpose of international trade only and to meet the requirements of bilateral trade agreements – not trilateral or multilateral trade agreements which are nothing more than foreign investor takeovers.
      The Dairy farmers not entering in to the quota system can expand and supply Canadians locally and provide more jobs and localized industry and add to our economy. I propose two Dairy markets within Canada – international with quota requirements to meet contract obligations and the second one a free market to create all of the possible jobs and prosperity from dairy and I am sure that anyone worth their own salt can work out the details. The Industry organizations that produce nothing by their own hands and the government have too much say in what dairy farmers or the public can or cannot do and it is time to turn that around. It is time that all of the dairy farmers and the public say to the organizations and to the government – hey, you work for me – I don’t work for you – and wouldn’t that be refreshing.

      • old grouchy

        I’m thinking you quite missed what I was trying to say sir!

        “Why do you think that they are making lousy choices; what compels them?”

        Is the only thing that I will respond to. IMO what I’m seeing today as the “lousy choices” is based largely on the ‘I have my rights’ kind of thinking.
        I have a right to my car, I have a right to my cigarettes, I have a right to my lifestyle, I have a right to abuse myself in any way I want (and for me the clincher!), I have a right to demand that you provide for me because I think you owe me (and what is not verbalized is – – – what I want).

        Sorry – – – everyone is owed an opportunity – – – not a handout!

        • Harold

          What would you expect to come out of the other end of an education system that moves students ahead without the merit of attaining the grade? They didn’t earn the grade but they move them forward anyways because they don’t want to hurt the student’s feelings. They come out of any such system with hyper feelings and expecting unearned gratuity because that is how they are trained. Were the students in control of this or was the education system in control and who earns the fake title of success other than the education system? We take their fake title as though the students thereafter were given an opportunity. The opportunity was the education system and the education system is failed and not the students. You are blaming the exhaust and not the motor. Some from the failed system are lucky to get a job but standing the test of time they lose it and travel losing job after job. The food bank along with tax payer funded social programs is where they accumulate. With an uncertain future and lacking in merit high on hyper feelings, they resort to things that they can control but the things that they choose (bad choices) such as cigarettes and such end up controlling them instead. The alternative to the food bank for them is theft and some avoid the food bank and go directly into crime including street drug sales. The jail is their hand out. This is not the result of merit it is the result of an opportunity that is of itself a failure; the education system. There is much more that I can add from various studies, but no, I didn’t miss what you were saying; quite the opposite. Yes you are seeing what you are seeing and hearing what you are hearing but they have not been the problem. What you do not see are the people who are the very same but have jobs but they suffer in debt due to the very same trained attitude of unearned merit and expecting money handouts and they get it from loans and their credit cards for which they quickly max out. The Debt they choose does not buy them an asset that earns them money; the debt is an unearned merit of wants and not needs along with a hyper sensitivity. The logic of responsibility to needs rather than to wants enrages them and they have jobs but that is the training of a meritless educational system and the same as you see and hear coming from the unemployed.

  • Farmer

    Hmmmmmmm……….
    … If consumers want to compare prices just go to Costco in Canada and then go to Costco in the USA, probably the fairest comparison available. If it really taste so bad you should not be worried about US milk being consumed by Canadian consumers…. or maybe there was a foul taste in your mouth to start with.
    The issue is not Canada maintaining a closed market, the issue is the expansion of the market outside its borders. It is a shame that the greed of Canadian dairy producers to expand beyond what it committed to at the WTO could risk the future of other Canadian ag commodities. Beef, pork and cereal crops all live in the real world of commodity pricing and enjoy quite open trade with the US. You can disparage the American dairy industry all you want, but that will be a small consolation when other Canadian ag commodities have to pay the price of a closed border.

    • old grouchy

      Quite sorry that your reading is leading you astray – – – you might note that my comment about taste was directed at a particular form of the product. If you wish to construe that comment to mean a generic overall comment feel free but then that is YOUR comment and not mine.

      Please do not put words in my mouth.
      Your response also tells me that you have not seriously considered the differences between the various forms of dairy products available for purchase today.
      Hmmmmmmmmmmmm – – – “. . . the issue is the expansion of the market outside its border.”
      I tried to align the columns so it would be easier to read but the system here doesn’t allow such to remain. If you actually read (and understood) the numbers included you might note that the American dairy system is exporting 31 times as much product as the Canadian one. Enough said – – – …

      • Harold

        You have no doubt noticed that to gain any information from Canadian sources is almost non existent when compared to the USA who are awash in free information. In the most part, I can only find in Canada, Industry and government washed information, and I am not referring to just this one specific issue.

  • Canadafirst

    What a garbage Article, why should we Canadians throw a successful industry under the bus that is strong in all 10 provinces? If we shut down SM and allowed unrestricted access for American milk and eggs, our dairy industry would cease to exist. This would ruin a vast part of the rural Canadian economy. Americans protect their interests first as should Canada protect its well established industries.

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