New Trade Deal Leaves Ohio Dairy Industry Hopeful

The new trade agreement between the United States, Mexico and Canada offered some rare good news for struggling domestic dairy farmers.

The deal would give U.S. farmers more access to the protected Canadian dairy market. The change is similar to a provision in the Trans-Pacific Partnership, the trade pact canceled by the Trump administration, according to Ohio State University professor Ian Sheldon.

“I’ll call that a crack in the door,” Ohio Dairy Producers Association CEO Scott Higgins said.  “And that gives us an opportunity to continue to do business with the companies that are looking for U.S. dairy products.”

Low prices have put pressure on the industry, driving some Ohio farmers to leave the business entirely.

The number of Ohio dairy farms has fallen 7.4 percent in the past year, according to Dianne Shoemaker, a field specialist at Ohio State University.

“This has been a very bad time to be a dairy farmer,” Shoemaker said. “We’ve had very low prices for three years, our markets are much more volatile than they used to be.”

Meanwhile, milk production continues to rise. That oversupply keeps prices low. In Ohio, milk prices rose in 2017, but are still below 2014 levels, according to the U.S. Department of Agriculture.

“We still have too much milk,” Shoemaker said. “We have a lot of cows, and we have a lot of cows producing milk.”

Under the terms of the trilateral agreement, Canada would also do away with a rule that Scott Higgins said allowed it to undercut American prices for some dairy products. He said the expansion of exports should have a positive effect on prices.

“It’s not going to cure the problems,” Dianne Shoemaker said. “But hopefully it will protect and allow us to continue to grow export markets for milk.”

Ohio is the eleventh-largest milk-producing state in the U.S., supplying 2.6 percent of the nation’s milk in 2017, according to USDA data.