IDFA, along with 168 other food and agriculture groups, this week stressed to every state’s governors, agriculture commissioners and leaders of economic development that a withdrawal from the North American Free Trade Agreement (NAFTA) would be detrimental to U.S. agriculture. The groups urged the state government leaders to contact President Donald Trump and support efforts to modernize the trade agreement. The letter specifically mentioned dairy, saying that ending the agreement would cause tariff rates to soar and would undermine the market for U.S. dairy exports in Mexico.
“Notice of withdrawal from NAFTA would result in substantial harm to the U.S. economy generally and food and agriculture producers, in particular,” the groups said. “Such a notice of withdrawal would fuel additional uncertainty among our North American trading partners, creating a sense of urgency to explore non-U.S.-origin sources of supply.”
The groups called out the harm a withdrawal would cause the U.S. dairy industry.
“Over $1 billion a year in U.S. dairy products are shipped to Mexico,” the groups said. They added that if the United States, Mexico and Canada return to pre-NAFTA tariff rates, they could “range from 20 to 60 percent on cheese and up to 45 percent for skim milk powder, undermining the largest market by far for U.S. dairy exports at a time when Mexico is preparing to finalize negotiations with the EU, the world’s largest dairy exporter and a region keen to act as a substitute for U.S. dairy.”
In addition to the potential destabilization NAFTA withdrawal would have on the global dairy industry, the groups said a withdrawal could cause a loss of 256,000 U.S. jobs, including at least 50,000 U.S. food and agriculture jobs, and a drop in the U.S. global domestic product of $13 billion in the farm sector.
The letter especially urged state government leaders to continue their support of a strong modernization of the agreement during the 5th round of NAFTA talks, which are underway in Mexico City.
Read the letter to state governments here.
More than 20 freshman members of Congress also voiced their concerns ahead of the trade talks, sending a letter to U.S. Trade Representative Robert Lighthizer, where they stressed that several proposals under review could undercut American economic interests, paralyze dispute settlements and greatly reduce diplomatic relations.
Read the letter to Ambassador Lighthizer here.
The members of Congress also asked that Ambassador Lighthizer provide an in-person briefing to update Capitol Hill lawmakers on the status of the NAFTA negotiations.
For more information, contact Dave Carlin, senior vice president of legislative affairs and economic policy, at email@example.com.