Say goodbye to NAFDTA and hello to the United States-Mexico-Canada Agreement, or USMCA. The three countries have reached an agreement when it comes to trade. This new deal will have a big impact on the U.S. and Canadian dairy market. Nebraska State Dairy Association Executive Director Rod Johnson says this is something they have been watching carefully.
Johnson says, “We have had a lot of challenges dealing with Canada. We were watching very closely also what they could work out on the Canadian trade sides. The truth will be in the details of the new agreement. We are very hopeful that the Mexican side of this will continue to keep Mexico open as our largest trading customer for the dairy industry.”
Johnson says Nebraska producers are hoping the challenges with Canada can be worked out. Canada’s complex system included what is known as “Class 7”, which was a dry or powered milk product that was made available to the world market. Johnson is hoping that situation has been rectified and will open the market for more U.S. powdered or dry milk, concentrate and infant formula.
Johnson says, “They have an interesting federal program up there where their producers have quotas and very good price protections and it has created an imbalance across the border there for what producers up there are receiving pricewise and what is happening in the U.S. and the impact of what they are doing on the rest of the world market.”
The World Dairy Expo is taking place this week in Madison, Wisconsin and Johnson believes this will be a big conversation at the meeting and hopefully many experts who will be able to clarify the new agreement.