The U.S. is requesting dispute-settlement cosulations for a third time over Canada’s dairy quotas, saying it has found more areas of “deep concern” and that the nation’s measures are inconsistent with it’s obligations under the U.S.-Mexico-Canada Agreement (USMCA).
Washington is expanding its challenge to include Canada’s use of a market-share approach for determining the quotas, according to the Office of the U.S. Trade Representative. It said Ottawa’s method prohibits eligible applicants--including retailers and food-service operators--from accessing allocations.
Under the USMCA that took effect in July 2020, Canada conceded to granting more duty-free or lower tariff access across dairy products though a tariff-rate quota, or TRQ, with products including:
- Milk
- Cream cheese
- Yogurt
- Ice cream
But Canada was allocating a bulk of those imports to processors, limiting the ability of other groups like retailers to buy U.S. products.
“We remain very concerned by Canada’s refusal to honor USMCA commitments,” Ambassador Katherine Tai said. “Rather than work toward meeting its obligations, Canada persists in implementing new dairy policies that are inconsistent with the USMCA, and which continue to deny U.S. workers, farmers, producers, and exporters the full benefits of market access they were initially promised.”
The U.S. previously won a case under USMCA dispute settlement procedures, but has rejected Canada’s solution to the situation and requested additional consultations in May on the policies. Those discussions raised additional concerns by the U.S. and prompted this latest request for formal discussions on the issues.
If there is no eventual solution, the U.S. can request another dispute settlement panel be established.
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4 Ways to Advocate for Ag in the New Farm Bill
