“We will focus on the three R’s to grow U.S dairy export sales,” said Tom Vilsack about his new role as president and CEO of the U.S. Dairy Export Council. In making that statement, Vilsack drew upon a direct correlation to the age-old adage of focusing on the three R’s of reading, writing, and arithmetic as a student.
“Relationships do matter when growing dairy exports,” Vilsack told those attending the 19th annual meeting of Dairy Farmers of America. “Resources must be allocated to build these relationships. Lastly, there will be risks when developing markets,” said the nation’s 30th USDA Secretary when discussing his new role of helping U.S. dairy farmers.
The trade front does have its challenges, though.
“Geographical Indications or GI’s do not represent free and fair trade,” said Vilsack, pointing to the European Union’s strategy to essentially trademark common cheese names when making new trade agreements with other countries. “We need Mexico’s support on the GI front,” said Vilsack in reference to his recent trip to meet with that country’s leaders. Mexico, of course, is America’s largest trade partner for dairy products.
Vilsack shared five more points for additional dairy export strategies.
- “We want to secure additional access to markets that are relatively closed,” said Vilsack who referenced yet-to-be signed U.S. government memos that would further open access to China.
- “We have been working to educate our policymakers on access to Canadian markets,” explained Vilsack, noting Canada’s relatively closed-door policy toward U.S. dairy product sales.
- “Recently, we did a state-by-state analysis of the dairy sector. Then we reached out to governors who neighbor Canada and shared the direct economic impact U.S. dairy farms and the associated manufacturing have on their respective states,” said Vilsack. After this engagement, it’s hoped that governors of Washington, Wisconsin, and New York reach out to Canadian and U.S. politicians to further share that story. “On the national level, we appreciate that House Speaker Paul Ryan (R-Wis.) raised the topic with Canadian officials,” said Vilsack.
- “Growing demand is important. We want to work with other countries to grow dairy demand. Not only does that approach help local producers, but it helps our ability to export dairy products,” Vilsack told those attending the Kansas City, Mo., meeting. Take Mexico for example. Since the North American Free Trade Agreement (NAFTA) was signed, productivity of Mexican dairy farmers and their cows grew by 58 percent. However, the reality is that demand outstripped domestic supply. As a result, Mexico imports 30 percent of its dairy products with 70 to 74 percent of the sales coming from the U.S. in any given year.
- “How do we gain a competitive edge?” asked Vilsack rhetorically. “We have to be in those countries that want to buy dairy products so we can understand their needs and facilitate sales,” he said, citing the Asian market with 3 billion people or one third of the world’s population. “Middle class Asian consumers represent 10 times of those in the United States. We cannot cede that territory to our competitors.”
(c) Hoard's Dairyman Intel 2017