Recently, the USDA announced a $12 billion aid package to help farmers impacted by the retaliatory tariffs put in place by some of our trading partners. Unfortunately, the bail out isn’t a long-term solution, according to Tom Vilsack, CEO of the U.S. Dairy Export Council.
“The dairy industry has faced a $1.8 billion loss over the last several weeks,” Vilsack said during an interview with MSNBC. “It’s a fairly significant challenge farmers face because of the tariffs. Markets that were open, markets that had momentum, are now shut off.”
One example is Mexico. For several years Mexico has been the No. 1 export market for U.S. cheese. The retaliatory tariffs put in place by Mexico are changing that trading dynamic.
“Our cheese used to be very, very financially advantageous to the Mexicans because of NAFTA,” Vilsack explained. “The retaliatory tariffs assessed by Mexico makes it less attractive for Mexicans to purchase cheese from the U.S. We still have a logistical advantage but at the end of the day the tariffs have made it difficult to make the financial case.”
To make matters worse, the aid announced by USDA is not likely to fix the problem, according to Vilsack.
“The problem with the bail out is that it provides some additional help now, but it doesn’t necessarily guarantee that we’ll get markets back that we’ll lose over time as the result of these tariffs,” he said adding farmers want trade not aid.