A dairy economist says a trade war with Mexico would cause major issues for the U.S. dairy industry.

Corey Geiger with CoBank tells Brownfield, “One in six tankers of milk leave our shores, and not necessarily our shores sometimes it just crosses our border.” “Our number one customer is Mexico. One in four dairy products that we export go to Mexico.”

He says 84 percent of Mexico’s dairy imports come from the U.S.

Geiger says a trade war with China would have less of an impact on the sector.

“If Mexico is importing about 4.5 percent of our milk production via dairy products and ingredients, China’s under one percent,” he explains.

The Mexican president has said she will match any tariff restrictions put in place by President-elect Trump who has threatened 25 percent tariffs on Mexican goods.

Tariffs between the two countries were in place for about a year during the first Trump administration including on cheese exports.

Analysis by the U.S. Dairy Export Council in 2018 found the previous tariffs on Mexican and Chinese goods had the potential to reduce farm-gate revenue by $16.6 billion through 2023.

The USDA Economic Research Service estimates the total economic impact of retaliatory tariffs from 2018 through 2019 cost more than $27 billion in lost ag exports, three percent of which were losses in dairy exports.

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