Canadian dairy farmers react angrily after Trump's tweet

The new trade agreement between the United States, Canada and Mexico, called USMCA, still needs to be approved by the legislative bodies of each country. Under the recent agreement, tariffs for Canadian dairy products would not disappear completely, but US dairy farmers would have greater access to Canada, a troubling prospect for Canadian dairy farmers.

Phillip Armstrong's family has operated the same land in Caledon, Ontario since 1869. Clearly, dairy farming has evolved significantly since then. He has also made tremendous progress since graduating from university 37 years ago. Today, each of his 380 cows wears a high-tech collar.

"The necklace they wear is a piece of identity, but it also measures his eating habits, on a particular cow. He measures his rumen, his stomach movements to make sure everything goes well. She measures her rest time, she measures her activity, "says Armstrong.

Combining this technology with improved breeding and nutrition, Armstrong says his cows are almost twice as productive as four decades ago. It may sound great, but it has also created a problem for dairy farmers around the world – they produce too much milk. To maintain control, Canada has a system. In simple terms: they match the offer to the consumer demand.

Related: The NAFTA revisions by Trump – designed to help the US auto industry – could have an opposite impact

"Every farm has a quota and that's our share of the Canadian market," Armstrong says.

As part of its supply management system, Canada also imposes high tariffs on imports of foreign dairy products, up to about 300%. Canada lets certain US dairy products enter before tariffs come into effect and, under the updated trade agreement, Canada would open an additional 3.6% of its market for products American dairy.

"And you're going, 'OK, well, that's not much," Armstrong says. "But it's the growth of income that we give up that allows us to modernize, grow, and everything else. So it's frustrating for us dairy farmers. "

Canadian dairy farmers have also given up greater access to Europe, New Zealand and Australia through other recent trade agreements.

The dairy trade between the United States and Canada is a fragment of the overall trade between the two countries. And Armstrong is upset that President Trump has identified the Canadian dairy sector as the main problem.

"He was misrepresenting the facts or maybe not understanding the facts, I do not know," says Armstrong. "And he said we were hurting their dairy farmers. Well, the Americans had a surplus of $ 600 million with us. But he understood that we were abusing their farmers. "

Many US dairy farmers are in agreement with President Trump and congratulate him for defending him. They point out that Canada has recently redefined some of its products – protein concentrates called ultrafiltered milk – and created price support measures to effectively exclude US products. The new category – called Class 7 – will be eliminated under the new NAFTA.

The pain on American dairy farms is real. Thousands of small American dairy farms have closed in recent years. It's not all because of Canada, far from it. US farmers have been driven out by consolidation, industrial agriculture, global competition and low prices. People also consume just less milk.

"A lot of milk has been thrown into the past because it could not be processed in a reasonable time, nor sold at a very low price," says Brian Gould, professor of agribusiness at the University of Wisconsin. "It's just too much milk, we have too much milk in the United States."

Although US dairy farmers may be badly off, Gould says the United States should not tell Canada how to manage its domestic agriculture.

"We do not have the right to do that. I really think we are on the ice when we ask that they get rid of their quota system. "

Gould says to think on the contrary: Canada is asking the United States to dismantle their system. The US government sets a minimum price for milk and also provides subsidies to US dairy farmers.

And the United States applies its own high tariffs on certain products – the US tariff for sour cream, for example, is 187%.

"On other cheeses, tariffs are close to 50%," says Graham Lloyd, general manager of the Dairy Farmers of Ontario.

Lloyd says that whole milk poured into Canada is really politics.

"Wisconsin being an important state for Republicans, namely the president [Paul] Ryan, and it's a state that brought Trump, became a lightning rod, "Lloyd said.

Back at the farm, Armstrong says the new NAFTA agreement does not solve the fundamental problem: US farmers are producing too much milk. And Armstrong thinks that opening up a little bit more of Canada will not change that.

"I feel for the dairy farmer in the United States. I mean, it must hurt, "says Armstrong. The new trade deal, he says, "is going to hurt us, but it has no impact on their well-being."

Again, many farmers in Wisconsin and New York see things differently. They are happy to have greater access to Canadian markets. Yet, ironically, many US dairy producers and their organizations are currently interested in their own supply management system, similar to Canada's.