Federal officials misled the industry about when the agreement would come into force, sector stakeholders say
By Jackie Clark
Staff Writer
Farms.com
Stakeholders in the Canadian dairy industry are concerned about the effects of the July 1 implementation of the Canada, United States Mexico Agreement (CUSMA). The sector had previously sought support from parliamentarians to ensure the new North American trade agreement would not come into force until August 1, the start of a new dairy year.
The House of Commons passed Bill C-4 An Act to Implement the Agreement between Canada, the United States of America and the United Mexican States on March 13, and the agreement received royal assent the same day.
“Canada has now notified the United States and Mexico that we have completed our domestic ratification process of the new NAFTA. This is an important step towards implementing this essential trade agreement. The Canadian government will continue to work with the United States and Mexican governments to determine an ‘entry into force’ date that is mutually beneficial,” deputy prime minister Chrystia Freeland said in a statement on April 3.
The agreement will enter into force on July 1, 2020, the Office of the United States Trade Representative confirmed in a statement on April 24.
“The Dairy Farmers of Canada (DFC) and the Dairy Processors Association of Canada confirm today, that not only were parliamentarians misled by the Trudeau Government, but they too were misled on the date of implementation of CUSMA,” said an April 29 statement from DFC.
An August 1 implementation “would have allowed the sector a full 12 months of exports per the negotiated concession for year-one threshold limit on key dairy products, before being constrained by the significant reduction conceded in year two of the agreement.”
The result of the early implementation will be large-scale losses for the Canadian dairy industry.
“The impact of the implementation of the CUSMA on July 1st versus August 1st is roughly estimated at $100 million for the sector. It includes the impact of the market losses for both producers and processors from increased imports and the export cap,” DFC told Farms.com in an e-mail statement.
“More specifically, the increased loss between year one and year two, due to a higher level of imports, would be $15 million for producers and $30 million for processors and, up to an additional $50 million in annual losses for the industry due to the decrease in the export cap placed on skim milk powder and milk protein concentrates.
“We are analyzing the impacts more closely and will bring this issue to the table during our discussions with the government,” the statement said.
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