The President of the United States, Donald Trump took to Twitter again on Monday and in a series of tweets discussing the new aluminum and steel tariffs, he criticised NAFTA and said that farmers in the U.S. have been hurt by agricultural policies in Canada.
His tweets, which said “We have large trade deficits with Mexico and Canada. NAFTA, which is under renegotiation right now, has been a bad deal for U.S.A. Massive relocation of companies & jobs. Tariffs on Steel and Aluminum will only come off if new & fair NAFTA agreement is signed. Also, Canada must…treat our farmers much better,” refer to supply management, a practice in Canada which protects domestic poultry, eggs, and dairy through high tariffs and controlled production.
This system looks like it is about to become a big obstacle in the NAFTA negotiations since the announcement of the new aluminum and steel tariffs from the United States. Last month before the new U.S. tariffs were announced, the U.S. wanted Canada to dismantle their supply management program. The Minister of Agriculture, Food and Rural Affairs for Ontario said that “When it comes to supplying management, we believe there can be no concession.” That statement now seems to have bigger implications as Trump holds the threat of not excluding Canada from the United State’s aluminum and steel tariffs.
Why is it that President Trump feels that Canada mistreats United States farmers? Many dairy farmers in the U.S. claim that Canada’s supply management program has cut U.S. farmers out of the market and is abusing the supply management program to sell cheap milk. Jaime Castaneda, the senior vice president for strategic initiatives and trade policy for the National Milk Producers Federation agrees with the president’s views.
Although the supply management program has been around for about 50 years, it starts to make news in the United States last year when Ontario closed a loophole in the supply management system that was allowing ultrafiltered milk to enter the country duty-free. Closing this loophole caused many farmers in the United States to immediately lose milk processing contracts while allowing Canadian farmers to export huge quantities of cheap skim milk, which had an effect on the world market.
With Canadian politicians, including Justin Trudeau, praising the supply management program and saying that it is not Canada’s fault that U.S. dairy farmers are having problems, the next round of NAFTA negotiations isn’t looking too promising.
Benjamin Diaz started working for Debate Report in 2017. Ben grew up in a small town in northern Ontario. He studied chemistry in college, graduated, and married his wife a year later. Benhas been a proud Torontonian for the past 10 years. He covers politics and the economy. Previously he wrote for CTV News and the Huffington Post Canada.