Washington, D.C. - The president and CEO of the International Dairy Foods Association today expressed concerns about the impact that the implementation of controversial new assessments on dairy imports will have on trade.
"We trade with more than 150 countries and continually advocate for open markets and trade policies that comply with international laws," said Connie Tipton, IDFA president and CEO. "This international tax does not help expand our U.S. dairy export markets and has been widely opposed by our trading partners."
Yesterday the Obama administration reversed a pro-trade decision of the Bush administration when the U.S. Department of Agriculture announced the final rule on the establishment of a dairy import assessment. The program was first authorized in the Farm Security and Rural Investment Act of 2002 (2002 Farm Bill) and later amended in the Food, Conservation and Energy Act of 2008 (2008 Farm Bill), with clear instructions from Congress that the program was not to be implemented if it did not comply with U.S. trade obligations.
"With this decision by USDA, we are concerned about how other countries will respond to our dairy exports once they become aware of the extra administrative burden and cost with limited or no benefits," said Tipton.
USDA will now collect 7.5 cents per hundredweight on imported dairy products and other foods with dairy ingredients, including cocoas and dough. The money collected by the government will be turned over to an advertising and promotion program currently operated and funded by U.S.
dairy farmers. The new rule stipulates that, because importers are adding additional funding to the program, USDA will require U.S. dairy producers and importers to jointly develop programs to build demand for imported dairy products and dairy ingredients.
"It's unclear to us why dairy producers are willing to promote dairy imports at a time when U.S. dairy imports are declining and our U.S. exports are growing," said Tipton.