Cautious optimism over trade agreement
Regional farmers and agricultural officials reacted last week with cautious optimism to the U.S. government’s new North American trade agreement that could expand market access and benefit American dairy producers the most.
The United States-Mexico-Canada Agreement, finalized late in the night on Sept. 30, is designed to open fresh access to the Canadian dairy market, including new tariff quotas that would allow Canadians to buy more fluid milk, cheese, cream and other American dairy products.
The United States exported more than $600 million in dairy products to Canada in 2017.
Canada also agreed to eliminate classes 6 and 7 of its milk class program, which helped Canada undersell the United States on low-priced dairy ingredients in Canada and other countries.
The Canadian government also agreed to apply charges to skim milk powder, milk protein concentrates and infant formula once exports cross on agreed-upon threshold.
The agreement still needs to be ratified by the legislatures of each member nation, including the United States, and the benefits to Delmarva producers remained unclear last week.
“I think we may not know how good this deal is for a couple years, but I think it has to be an improvement,” said Chuck Fry, a Frederick County dairy farmer and president of the Maryland Farm Bureau. “I think it’s got some positive things.
“And certainly having an agreement with your neighbors is much better than being in a fight with them all the time.”
Several regional farmers said they hope the agreement improves milk prices, which could help the region’s struggling dairy industry.
Many farmers, over-indebted and still recovering from the Great Recession, exited the industry within the last two years after milk prices sank from a 2014 high to a level that is, for many farmers, below the cost of production.
Bobby Bender, a Garrett County dairy farmer, said he eliminated the last paid position on his operation and now works only with his 20-year-old son.
He said he’s overworked and unsure what to make of the new dairy agreement.
“It’s pretty tough,” the 59-year-old said. “I don’t have much time to watch TV or read papers because I just fall asleep.”
The Maryland & Virginia Milk Producers Cooperative Association, one of the region’s largest cooperatives, has lost 10 percent of its farmers over the last several years, spokesperson Amber Sheridan said.
The cooperative still has about 1,250 member farms from Maryland to Georgia, but milk production is down about 5 to 6 percent over the last year, she said.
The cooperative was, again, cautiously optimistic about the new trade agreement’s benefits to regional dairy producers, Sheridan said.
It should help create a fairer international market, she said.
“It appears like there will be some positive impact on dairy prices, but it’s too early to speculate on that,” she said.
Any assistance would be a great help to Delaware’s dairy farmers, Agricultural Secretary Michael Scuse said.
“Our farmers are suffering losses, and these losses have been occurring now for a couple of years, and it’s too the point where a lot of farmers are saying ‘enough is enough,’” he said. “We really truly do need our dairy producers. … Every time we lose one of those, we’re losing a family farming operation that in many cases is critical to the communities where they live and work.”
There are about 35 dairy farms left in Delaware, he said.
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