The U.S. Dairy Export Council (USDEC) and National Milk Producers Federation (NMPF) today thanked the U.S. government for its work to reach an interim agreement with Japan that will deliver improvements in market access for the U.S. dairy industry, while noting that the work to secure a sufficient competitive landscape in Japan for dairy is not finished.
NMPF and USDEC look forward to reviewing with their members the details of this first stage of a trade agreement with Japan to take advantage of the new opportunities it will provide on a near-term basis while continuing to work with the Administration to secure the additional elements that are still needed to ensure a strong final dairy package in a comprehensive agreement.
“This enhanced access into the Japanese market is welcome news. Japan represents a rapidly growing market, and without a trade deal, our competitors are poised to seize valuable market share from U.S. dairy,” said Tom Vilsack, president and CEO of USDEC. “This first stage of a US-Japan agreement will improve upon today’s status quo, which has been unsatisfactory ever since Japan’s treaties with the CPTPP nations and the EU went into effect. To continue that progress toward closing the competitiveness gap with both CPTPP and EU suppliers, it’s essential that the U.S. secure further market openings and assurances in the second stage of negotiations with Japan to best position the U.S. to compete against all of our major competitors in Japan.”
“This interim trade agreement with Japan is welcome news for farmers across the U.S. who have seen their incomes damaged by trade disputes,” said Jim Mulhern, president and CEO of NMPF. “Today’s news is not the end of the road though; it’s the first leg of the journey. We thank America’s trade negotiators for their pursuit of a deal aimed at benefiting our dairy farmers and expanding international markets for their high-quality milk. To reap those full rewards and ensure the U.S. is able to best compete in the Japanese market, the subsequent stage of negotiations must secure further inroads into Japan, building upon what our key competitors – the European Union and New Zealand – have secured there.”
NMPF and USDEC agree with what Ambassador Lighthizer told the House Ways and Means Committee during his testimony in June: “You cannot treat your best customer worse than you treat people from all these other countries in Europe and all the other TPP countries.”
Last month, USDEC and NMPF coordinated a letter signed by 70 dairy companies, farmer-owned cooperatives, and associations to the United States Trade Representative and the U.S. Secretary of Agriculture asking the U.S. government to move swiftly to finalize a strong trade deal with Japan and secure critical market access for the U.S. dairy industry. The objectives outlined in that letter remain the industry’s expectation for a comprehensive agreement with Japan.
The U.S. exported $270 million in dairy products to Japan in 2018 with room for further growth. However, without a strong trade agreement that addresses the inequalities in market access granted to our competitors by the Japan-EU and CPTPP agreements, a 2019 USDEC study found that the U.S. risked losing $1.3 billion in exports over a decade, costing dairy farmers $1.7 billion in farm income.