By Beth Hughes, IDFA Director of International Affairs

Many trade policy developments that are important to dairy happened during this past weekend. A “ceasefire” on trade threats between the United States and China, updates on possible exemptions for the U.S. steel and aluminum tariffs, and negotiations on the North American Free Trade Agreement (NAFTA) topped the list.

‘Ceasefire’ with China

After two days of high-level talks between Chinese and U.S. officials, a ceasefire has been called between the two countries. A framework to reduce the U.S. trade deficit with China, which  included “meaningful increases in United States agriculture and energy exports,” was announced Saturday. China also announced it will terminate its antidumping and countervailing duty investigations of U.S. sorghum, which were initiated in February.

Details of the agreement are still being negotiated, but reports indicate the trade deficit would be reduced by $200 billion and U.S. agriculture exports to China would increase 35 percent to 45 percent this year. IDFA has been in contact with administration officials to ensure that U.S. dairy products will benefit from this enhanced export opportunity.

As part of the agreement, the United States agreed to put on hold the tariffs on Chinese goods stemming from the U.S. Section 301 investigation into Chinese practices and policies on intellectual property. It remains unclear whether the Section 232 tariffs that have already been imposed on imported Chinese steel and aluminum will be lifted.

Steel and Aluminum Tariffs

The one-month extension from looming Section 232 tariffs on aluminum and steel granted to Canada, Mexico and the European Union is set to expire on June 1. Last week, the EU released a list of $3.34 billion worth of U.S. products that could be subject to 25-percent tariffs starting on June 20 if the EU is not granted a permanent exemption. Fruits, vegetables, rice and tobacco are among the agricultural products on the list, but U.S. dairy products were not included.

NAFTA

House Speaker Paul Ryan, R-Wis., recently said the administration would need to announce a new NAFTA agreement by May 17 to comply with the Trade Promotion Authority’s legal procedural deadlines that would allow a vote on the agreement in this Congress during the lame-duck session following the November mid-term elections. While the May 17 deadline was not met, Speaker Ryan also noted that Washington, D.C., is known for having multiple deadlines, so IDFA will continue to push for completion of the NAFTA renegotiations, recognizing that some procedural steps might be completed faster than projected under the Trade Promotion Authority deadline.

IDFA also has heard talk of a “skinny” deal between the three countries that would not require a congressional vote. This type of agreement could still address IDFA’s call to eliminate Canada’s Class 7 pricing program.

Members with questions may contact Hughes at bhughes@idfa.org.