US Dairy Questions
Colombia Tariffs
US
dairy industry groups are calling on the US government to come up with a plan now
if Colombia imposes countervailing duties on US milk powder exports.
The
groups want the Administration to “leverage all available tools” if Colombia moves
ahead with imposing the duties. The National Milk Producers Federation and US Dairy
Export Council made the request in a letter to US Trade Representative Katherine
Tai and Agriculture Secretary Tom Vilsack.
The
US industry groups called Colombia’s recent decision to initiate a CVD investigation
into U.S. exports of milk powder “baseless.” The US government should “challenge
this unfounded investigation directly and be prepared to leverage all available
tools to counter any injury imposed on the US dairy industry should Colombia move
forward with imposing countervailing duties.”
The
Colombian allegations are without merit, the groups wrote. “US powdered milk products
do not benefit from direct or indirect US subsidies. Furthermore, milk powder and
fluid milk are not interchangeable ingredients in a food manufacturing facility
due to differences in their physical characteristics. The production, distribution
and customer base for milk powder in Colombia’s large and diverse food processing
sector is also significantly different than those in Colombia purchasing fluid milk.
“As
such, the case fails to meet Colombia’s own requirements for demonstrating that
the product under investigation is a “like product” to the one manufactured by the
domestic industry claiming injury. There is no causal link between U.S. milk powder
exports to Colombia and the injury claimed by the Colombian government in the investigation.
This is particularly clear considering the different end users of Colombian fluid
milk versus end users of US milk powder in Colombia, most of which are food industry
manufacturers.”
The
groups said that while they are confident Colombia’s arguments and data are without
merit, they “are preparing for a potentially adverse decision due to the politically
driven nature of this government-initiated case.”
US
producers export about $70 million worth of milk powder to Colombia each year. “It
is imperative that the United States respond forcefully to any imposition of countervailing
duties in Colombia in this case and send a strong message to all US trading partners
that unfounded attempts to block imports through misuse of trade policy tools will
not be tolerated,” they wrote.