The United States-Mexico-Canada Agreement went into effect on July 1st 2020 and was designed to allow for more balanced and reciprocal trade between the three North American trade partners.
However, a recent USMCA dispute panel argued that Canada’s dairy import policies don’t breach its commitments under the U.S.-Mexico-Canada agreement. This came after the United States dairy industry and U.S. trade organizations argued that Canada’s protectionist practices allow Canada to ignore its USMCA commitments.
Late last week, a U.S.-Mexico-Canada Agreement dispute panel allowed Canada to continue restricting dairy access that the U.S. negotiated for under the agreement. The action came after an earlier panel ruled in January 2022 that Canada had improperly restricted access to its market for American dairy products.
United States Senator Chuck Grassley (R-IA) says that this latest decision allows Canada to continue practices that were thought to be done away with as part of the original USMCA Agreement.
Grassley says the USMCA Agreement was popular in the United States Senate because of the hope that it would open up Canada’s dairy market access.
Grassley says the Biden administration’s trade policy is not doing enough to expand free trade opportunities for U.S. commodities.
U.S. Trade Representative Katherine Tai said two of the three USMCA dispute panel members found that Canada’s dairy import policies don’t breach its commitments under the U.S.-Mexico-Canada agreement.
“I’m very disappointed by the findings in the USMCA panel report on Canada’s dairy TRQ allocation measures,” Tai says. “While the United States won a previous USMCA dispute on Canada’s dairy TRQ allocations, Canada’s revised policies still haven’t fixed the problem for U.S. dairy farmers.”
