(Adds U.S. Trade Representative comment)
WASHINGTON, June 3 U.S. dairy farmers and milk
processors on Wednesday threatened to oppose a Pacific trade
deal if Japan and Canada do not agree to accept substantially
more dairy imports.
In a letter to the U.S. Trade Representative and Department
of Agriculture, members of the National Milk Producers
Federation and the U.S. Dairy Export Council said Japan and
Canada were dragging their feet and U.S. negotiators must insist
on "meaningful" dairy market access.
The threat by U.S. agricultural lobbyists to oppose the pact
marked an escalation in the dispute and could undermine support
in Congress for the trade deal, which is still under
Japanese Economics Minister Akira Amari told Trans-Pacific
Partnership (TPP) trading partners at talks in Singapore last
month that Japan will not agree to abolish all tariffs on wheat,
rice, dairy, sugar, wheat, beef and pork.
The dairy groups said Canada would probably be guided by
Japan in deciding on any changes to its dairy market access. The
TPP also had to tackle New Zealand rules benefiting farmer
cooperative Fonterra, the world's biggest dairy
exporter, which controls nearly a third of global dairy trade.
"Our support for TPP is not unconditional," said the letter,
signed by 39 dairy companies and cooperatives.
"The elements cited here, which largely remain unresolved,
must be concluded in a positive manner or our industry will find
it difficult to support the final agreement."
The warning from dairy groups comes after wheat, rice and
pork farmers called for Japan to be cut out of the TPP talks if
it insisted on keeping tariffs on sensitive products, and cattle
farmers demanded the TPP eliminate all tariffs on
The farm lobby wields considerable power in Congress, and
their opposition could weaken lawmaker support for the TPP
further, especially with mid-term elections due in November.
The dairy groups said they might also withdraw their backing
for fast-track authority allowing the White House to pass trade
deals quickly through Congress, which would be another blow.
The TPP's stated goal is to eliminate tariffs and other
barriers to goods and services trade. USTR Michael Froman said
after the Singapore meeting that the United States was pressing
for tariffs to be eliminated "to the maximum extent possible,"
words which are worrying stakeholders.
A USTR spokesman said the United States had made it clear to
trading partners that it expected the final TPP agreement to
reflect the ambitious goals all countries signed up to.
"Like all exporters, America's dairy farmers have a lot to
gain through the Trans-Pacific Partnership and we are working
hard to unlock opportunities for them throughout the
Asia-Pacific region," he said.
(Reporting by Krista Hughes; Editing by Andrew Hay and Lisa