Dairy farming is not an easy business, but I choose to be a part of it every day. There is no other work that I find to be as challenging and as rewarding as managing a dairy farm. Success requires constant attention to the wellness of the cows and constant adjustments to my farming practices to stay efficient. A bonus is that my family is able to be in the barn with me most days.
It has been a tough pull in the dairy business the last few years, but this is not a “poor me” message. The dairy industry has been developing and maintaining trade relationships to export our products for years. We have created these markets with our own dollars.
It is a tough pill to swallow when trade disputes shut us out from our customers. Congress has an opportunity to provide us some meaningful help by passing the United States-Mexico-Canada Agreement (USMCA) this fall.
Minnesota is home to nearly 3,000 dairy farms. The economic health of our farms depends on expanding the international demand for high quality dairy products made from the milk our cows produce.
Twenty-five years ago, NAFTA helped establish the U.S. dairy industry as the world’s leading provider of dairy products. Minnesota sold more than $250 million in dairy products to customers around the world last year.
These exports bring benefits to Minnesota that extend beyond the farm. Last year, dairy exports supported more than 4,000 jobs for Minnesotans and had an economic impact of $610 million on our state.
USMCA will build upon and make necessary improvements to NAFTA’s framework, bringing increased benefits to America’s dairy farmers and the businesses that purchase our milk. Passing this trade agreement will secure our positive trade relationship with Mexico and remove trade barriers that have limited or threatened export opportunities.
Twenty-eight percent of American dairy exports are sold to Mexico, making them our industry’s largest customer. That adds up to the equivalent of 2.8 million gallons of milk flowing across our southern border every single day. USMCA will safeguard our valuable dairy export market in Mexico by ensuring agricultural tariffs between the U.S. and Mexico remain at zero.
USMCA also makes important changes to Canada’s trade-distorting policies, including reforms to their controversial dairy pricing system. That will expand export opportunities for U.S. dairy products into what is currently a tightly controlled market.
Ultimately, USMCA will increase dairy exports by more than $314 million a year, according to the International Trade Commission. Industry estimates project USMCA will improve dairy farm revenue by an additional $548 million over the first six years of implementation. For many farmers, that increased revenue could be the difference between staying in the dairy business or being forced to choose another way to make a living.
Without USMCA, the export markets we have worked so hard to maintain could be at risk. Dairy farmers are starting to see our prospects recover and we need to keep the momentum going. Failing to pass USMCA and jeopardizing trade relationships with our North American neighbors would be harmful for our rural economies.
Let’s not play politics on this one. Minnesota’s dairy farmers are counting on Congress and the administration to work together to secure our future and pass USMCA now.
Dan Krekelberg milks a 60-cow herd in Faribault.