New trade deal will hurt dairy industry and rural Canada, says farmer

Dairy producers across the country are nervous about Canada's new trade deal with the United States and Mexico, a deal that allows more American milk products into the country.

Canadian dairy farmers say the deal could cost jobs and damage the economies of rural areas because some consumers could stop buying Canadian-made dairy products. That could take money away from Canadian dairy producers.

"It's very disappointing, I got to be honest, as a dairy producer," Shubenacadie's GerritDamsteegt, a director of Dairy Farmers of Canada and chair of the Dairy Farmers of Nova Scotia, told Maritime Noon. "And I speak not for myself, I speak for 12,000 producers across the country."

Dairy farming is a $295-million industry in Nova Scotia alone with 210 farms across the province producing milk, according to industry figures.

Granting access to Canada's dairy market isone of the concessions the Canadian government gave the Americans in a tentative trilateral United States-Mexico-Canada Agreement (USMCA), formerly known as North American Free Trade Agreement.

Once word of the agreement was out,Damsteegt starting getting calls from worried producers across Canada. The first call came at 4 a.m. Monday

He said the new deal could hurt everyone associated with the Canadian dairy industry.

"It's not just me as a dairy farmer, it's the employees that I have on the farm, it's the businesses that I deal with be it feed companies, be it trucking, be it veterinarians, be it equipment dealers," he said.

"They all will feel the effect of it.

The new agreement, if ratified by all parties, would give American farmers access to 3.6 per cent of Canada's dairy market, according to the Dairy Farmers of Canada.

While that number may seem small,Damsteegt says any increase in American products will have a huge impact.

"This is going to affect the Canadian industry quite a bit and it's going to benefit the Americans very little because their overproduction is so great," he said. "They produce so much more milk than what they need, that really on the farmers' level it will not make any difference."

As part of the new agreement, Canada will also end what's called Class 7 pricing, which slashed prices on some Canadian-produced milk ingredients like skim milk and whole-milk powder. That price cut made U.S. equivalents uncompetitive.

"The quality of product that we produce is very high are we allowing product to come in that's produced under lower standards," said Damsteegt.

Effects unknown, premier says

Nova Scotia Premier Stephen McNeil said he and the other premiers had a call with Prime Minister Justin Trudeau around noon about the deal and that the ministers responsible for trade had a further briefing.

McNeil said the deal was an "important step" and the next step involvesfiguringout what impact the deal with have on local industries, including dairy farmers.

"What does it mean actually to those today in the barns across the province who are milking? What does it mean to their business model?" he said.

"When the federal government looks at saying, 'if it impacts them, how are we going to compensate?' We want to make sure they look at the entire range of operations in the dairy sector."

Canada, U.S. applaud deal

Despite concerns from the dairy industry, the Canadiangovernment and the Trump administration say the deal is good for both countries.

"USMCA will give our workers, farmers, ranchers, and businesses a high-standard trade agreement that will result in freer markets, fairer trade and robust economic growth in our region," Foreign Affairs Minister Chrystia Freeland and U.S. Trade Representative Robert Lighthizer said in a joint statement released late Sunday.

Damsteegt is hoping to get a better idea of what exactly the trade deal will mean for dairy producers as more details become available in the coming weeks.

Read more stories from CBCNova Scotia.