A $12 billion tariff relief program that was announced be the Trump Administration is being welcomed by the dairy industry.
On July 24, Agriculture Secretary Sonny Perdue announced implementation of a tariff mitigation program in response to retaliatory tariffs that have had widespread impacts on agriculture. Dairy products have been targeted by major trading partners like Mexico and China in the ongoing trade war. National Milk Producers Federation estimates tariffs will cost U.S. dairy farmers $1.8 billion through the end of 2018.
“We appreciate the president following through on his pledge that America’s farmers won’t bear the brunt of the economic losses generated by the current trade conflicts,” says Jim Mulhern, president and CEO of NMPF. “The announcement reflects requests that our organization has made of USDA to relieve some of the financial pain dairy farmers are feeling due to lost export opportunities.”
The move was important to dairy producers because approximately one day’s worth of milk production each week goes overseas, says Michael Dykes, D.V.M., International Dairy Foods Association (IDFA) president and CEO.
“As the administration advances a proactive and aggressive trade agenda, retaliatory tariffs by other countries, especially China, have impacted dairy exports. IDFA views this relief as a temporary bridge intended to alleviate some of the financial difficulties faced by the agriculture sector, including dairy, while the administration works to solidify multiple international trade deals,” Dykes says.
Prior to this week’s announcement a letter was sent by FarmFirst Dairy Cooperative and other Midwest Dairy Coalition members to Secretary Perdue on July 13 requesting the USDA utilize its authority to provide assistance to dairy farmers.
“Exports of dairy products and ingredients have greatly benefited farmers over the past several years and is becoming a more significant part of the price they receive for their milk. They must not bear the brunt of this trade war taking place,” says Jeff Lyon, General Manager of FarmFirst Dairy Cooperative. “We appreciate the prompt response that the USDA is making in regards to this issue and thank our partnered industry organizations in echoing our concerns to Secretary Perdue, the USDA and the Trump administration.”
Details on the $12 billion program are still being put together but more information should be available closer to Labor Day when USDA plans to fully implement the program.