Ensuring the smooth flow of these products, particularly to the two markets closest to home, is essential to the economic health of our dairy farmers and rural communities.
The trade relationships the U.S. shares with our North American neighbors are among our most important, but they are long overdue for an upgrade. Congress has the opportunity to make that happen by passing the United States-Mexico-Canada Agreement (USMCA). With just a handful of legislative days left on the congressional calendar in 2019, there’s no time to waste. Congressional action is urgently needed before 2020
Today, I joined with agriculture and congressional leaders on Capitol Hill to stress the importance of passing USMCA to the bolster the prosperity of American agriculture. Together, we called on Congress to act immediately to pass USMCA to improve our trade relationships and secure increased export opportunities.
Dairy producers in particular have a lot to gain from an updated trade framework. A 21st century version of NAFTA will deliver increased economic growth, jobs and trade opportunities, coming at a time when dairy farmers have been reeling from the effects of a sluggish rural economy. But without the congressional seal of approval, all of these benefits are at risk.
Mexico is the number-one export destination for American dairy products. Last year alone, Mexico purchased $1.4 billion worth of U.S. dairy products, accounting for over one-fourth of our dairy exports. It’s important that we protect our share of the Mexican market and maintain the valuable relationships that the U.S. dairy industry has cultivated over many years. Passing USMCA will secure the U.S. dairy industry’s existing access to the Mexican market while establishing new protections for Made-in-America cheeses that use common or generic names, such as swiss, havarti or mozzarella.
USMCA will also make vital reforms to Canada’s unfair milk pricing program. After years of trade-distorting policies and pricing, the U.S. dairy industry will gain expanded access to the Canadian market and benefit from major reforms curbing Canada’s ability to damage our exports to other markets around the world.
These new opportunities will translate to real benefits for America’s dairy farmers. The U.S. dairy industry estimates that over the first six years of implementation, USMCA will bolster dairy farm revenue by an additional $548 million.
Passing USMCA will achieve additional advantages for agriculture far beyond just those expected to be delivered to dairy. Designed for the demands of a 21st century economy, USMCA promises to build on the exponential success our agriculture industries have seen in the last quarter century under the NAFTA framework. Exports already support 325,000 agriculture jobs, but there is room for even further growth. Expanded market access and the implementation of new trade rules under this updated deal are expected to increase farm and food exports by $2.2 billion a year, supporting new jobs and economic opportunities for farmers across the country.
In total, USMCA is expected to pump more than $68 billion into the American economy and create 176,000 new jobs. With such a positive impact, getting this deal passed is something members of Congress on both sides of the aisle should support. They should prioritize passage of USMCA so that this trade deal is not lost in the midst of the coming national election season in 2020.
Passing USMCA will also demonstrate to our other nations across the globe that the U.S. is a reliable trading partner serious about negotiating new trade deals. Major exporters in the rest of the world are not waiting to craft new trade deals in the same markets where the U.S. must be competitive. Adopting the USMCA will bolster the potential to finalize additional trade deals with key nations and bring greater benefits to America’s farmers.
Rural America can no longer wait for USMCA. We’re counting on the Administration and Congress to work together to get this agreement across the finish line in order to secure a brighter future for America’s dairy producers, the agriculture industry and the nation’s economy.
Jim Mulhern is president and CEO of National Milk Producers Federation (NMPF).