U.S. Mexico Canada Agreement
Recent policy shifts have clouded the outlook for the months ahead, introducing demand uncertainty at a time when milk production and components are increasing.
In a Wednesday morning press conference, ahead of Trump announcing his global tariff plan, Sheinbaum says Mexico will “announce a comprehensive program, not a tit for tat on tariffs,” but added, “we have a plan to strengthen the economy under any circumstance.”
Tariff whiplash is consuming the commodity markets — and the possible impact is stirring up quite the debate. At present, President Trump says he’s sticking to his plan to impose additional tariffs on Canada, Mexico and China starting April 2.
The ongoing discourse between the U.S. and Canada underscores a critical need for diplomatic negotiations to address trade barriers.
Mexico’s president said on Tuesday the country will respond to U.S. tariffs with a 25% tariff on U.S. goods, but she will hold off announcing the targeted products until Sunday.
President Trump says tariffs on goods from Canada and Mexico will now take effect on April 2, 2025.
Trump said Monday that his planned 25% tariffs on all Mexican and Canadian exports to the U.S. “are going ahead on time, on schedule,” meaning the duties would take effect on March 4 at the conclusion of a one-month suspension.
Secretary of Agriculture Brooke Rollins kicked off the 2025 Top Producer Summit on Tuesday morning, detailing her plan to advocate for trade. ‘We want to find market access for all our products,’ Rollins said.
The measures, effective March 12, eliminate country-specific exemptions and extend to downstream steel and aluminum products, affecting key suppliers such as Canada, Mexico, Brazil, and South Korea.
Just hours before the tariffs were set to take effect, Mexican President Claudia Sheinbaum announced the news on X, and President Donald Trump later confirmed. Mexico is the top destination for U.S. ag exports. The announcement from Canada came later on Monday.
Following President Trump’s decision to impose 25% tariffs on Canada and Mexico, Canada announced its own 25% tariffs on $155 billion worth of U.S. imports. Mexico also announced its own retaliatory measures, but no specifics were unveiled as of Sunday morning.
U.S. farmers and various trade groups are very apprehensive about not only the potential negative impacts of tariffs on the U.S. ag sector, but what they do to garner new trade agreements.
Speaking from the Oval Office, Trump justified the tariffs as a response to what he described as excessive migration, drug trafficking and unfair trade practices. While he suggested the tariff rate could further increase, he indicated a decision on whether oil imports would be exempt would come soon.
Canada is preparing for potential trade challenges following Trump’s threat of a 25% tariff on Canadian imports. The Canadian government is considering a proactive approach, including the possible early release of a retaliatory tariff list.
Dairy producers are closely watching how potential trade changes could affect exports, particularly as concerns rise over Canada’s compliance with the USMCA and the critical role of top trading partners.
Threats of widespread tariffs and concerns about retaliation continue to stoke uneasiness in agriculture. With a growing trade deficit and hopes the U.S. could re-embark on the Phase One trade deal with China, could the focus back on trade be positive for agriculture?
In response to John Deere’s recent announcement about moving some of its production to Mexico, Trump expressed concern about the impact on American workers, stating, “It’s hurting our country. It’s hurting our workers.”
U.S. Agriculture Secretary Tom Vilsack says the Biden administration is looking for “creative” ways to sell more U.S. dairy products in Canada.
Dairy organizations are disheartened by USMCA’s dispute panel which is allowing Canada to restrict dairy access to the United States and weakens the agreement’s value for the U.S. dairy industry.
A trade dispute settlement panel set up under a major North American free trade agreement has rejected a U.S. complaint that Canada is improperly limiting access to its dairy market.
In April 2017, Ray Starling, Special Assistant to the President for Ag, Trade and Food Assistance during the Trump administration, received some important news. What happened next helped change the course of history.
This is the second case the U.S. has filed against Canada over dairy market access.
The United States on Tuesday said it was seeking a second trade dispute settlement panel over Canada’s dairy import quotas.
The issue over Canada’s dairy Tariff-Rate Quota isn’t over yet.
Under the USMCA, Canada conceded to granting lower tariff access across dairy products. But Canada was allocating a bulk of those imports to processors, limiting the ability of other groups to buy U.S. products.
Action by United States Trade Representative Katherine Tai expands dispute to address Canada’s continuing failure to meet Its USMCA obligations.
Despite a pending ‘agreement in principle,’ the U.S. and Canada remain at odds on dairy issues.