Stefanik Leads Bipartisan Letter Demanding Accountability of Canada's Obligations under USMCA

Letter

Dear Ambassador Tai and Secretary Vilsack:
We write to express our extreme disappointment in the latest dispute settlement ruling for
Canada's dairy tariff rate quota (TRQ) allocation measures under the United States-Mexico-Canada Agreement (USMCA). This ruling preserves a status quo that denies retailers, food
service operators, and other types of importers engaging in the Canadian food and agriculture
sector from utilizing TRQ allocations. Fair access to Canada's dairy TRQ allocations is
instrumental in ensuring that the market access gains the United States negotiated in the USMCA
are actually meaningful.
As you are aware, Canada is our second largest market for U.S. dairy exports, valued at $1.03
billion in exports in 2022, just behind Mexico at $2.44 billion.1
Together, our North American
trading partners represent roughly a third of the total U.S. dairy export market value.
However, Canada limits dairy imports to protect its supply management system. Canada's
unwillingness to provide fair market access harms U.S. dairy producers and processors and
contradicts our understanding of what was negotiated and agreed to in good faith under the
USMCA. Canada's unfair trade practices were made clear in the United States' first dairy
dispute against Canada in 2021, which determined Canada was not living up to its obligations.2
The changes that Canada has since made to "comply" with the 2021 ruling have not resulted in
increased export opportunities for U.S. dairy producers and processors.
While Canada is a valued trading partner, they should not be precluded from upholding their
USMCA commitments at the expense of American producers. We strongly encourage you to
prioritize fair access to the Canadian marketplace for U.S. dairy products and work collectively
between your departments to rectify this trade imbalance.
We understand that the second USMCA dairy TRQ panel ruling is not subject to appeal.
However, we request responses to the following questions:
1) What steps will the Office of the U.S. Trade Representative (USTR) and U.S.
Department of Agriculture (USDA) take to ensure fair access to Canadian export markets
for U.S. dairy products?
2) Will USTR consider exploring other ways to address Canada's dairy TRQ allocation
system through other trade tools?
3) Will USTR and USDA address other identified distortive Canadian dairy policies, such
as their milk class prices and increased dairy protein exports?
4) Could you please provide a congressional briefing on an estimated timeline and identified
next steps?
Thank you for your attention to this important matter. We appreciate your departments'
concentrated efforts to ensure fair market access for both U.S. dairy producers and processors,
and we strongly support additional action. If you have any questions, please do not hesitate to
reach out to our staff.

Source