Here & Now

DATCP Secretary Spells Out Dairy Market Crisis

Frederica Freyberg:

The entire Congressional delegation and Governor Scott Walker sent a letter to U.S. trade representatives and the secretaries of commerce and agriculture saying, quote, this situation underscores how Canada's new pricing policies are not only undermining trade with the United States, but are displacing fresh milk produced by hard-working dairy farmers in Wisconsin and around the country. The letter continues, we urge you to take immediate action to address this dire situation, where apparent unfair trade practices are putting Wisconsin dairy farmers’ livelihoods at risk. We look forward to working with you to break down these trade barriers, enforcing existing rules and improve Canadian market access for our producers in any future trade negotiations. We are joined now by Wisconsin Secretary of Agriculture, Trade and Consumer Protection, Ben Brancel. Thanks for being here.

Ben Brancel:

Thanks for having me.

Frederica Freyberg:

So what kind of response is Wisconsin getting to its call for immediate action on this?

Ben Brancel:

Well, I think the White House is reviewing what is the appropriate avenue to get Canada to really own up and be part of the discussions to deal with this issue.

Frederica Freyberg:

Well, let’s back up and have you help us understand why Canada changed its milk import policies.

Ben Brancel:

Well, Canada itself was reviewing its trade deficit, trade issues. I will say it that way. One of the things they recognized is we had a product from the state of Wisconsin that was moving into Canada. It’s about a $100 million value to the state of Wisconsin. And they took a look at how could we change things so that we wouldn’t have that competition here in our own country. And they changed their pricing structure. And that pricing structure change was targeted specifically to this product. And it comes from New York and the state of Wisconsin.

Frederica Freyberg:

How does it break existing trade rules or constitute unfair trade practices as was suggested in that letter?

Ben Brancel:

Well, we’re supposed to have free and open trade with the country, Canada and the country of Mexico, under the NAFTA agreements and it has worked very, very well for agriculture. But now Canada has not only in dairy, but a couple of items, found unique ways at the provincial level of government, not the national level, but the provincial level of government to put things in place that targets the products coming from the United States and is causing some undue harm and that’s what we’re here talking about today, the harm of some of our dairy producers.

Frederica Freyberg:

So in regard to that, what information do you have that any of the 75 farmers have found alternative processors to sell their milk to?

Ben Brancel:

Well, we’ve been discussing this topic with the processors. We’ve talked to the processor organizations. We’ve talked to the milk handlers. We’ve talked to the farm organizations. Today we’re going to have a discussion with the dairy farmers themselves. And we are opening up every channel possible to see if we have an avenue of success. And there has been reports that we are finding some of the milk a home.

Frederica Freyberg:

Okay. Any indication that farmers if they don’t find that have to start dumping milk?

Ben Brancel:

Well, this is the first time ever in the state of Wisconsin's history, ever, where milk produced here could not find a home. We’re still hoping that that’s going to happen. If they don’t find a home for your milk, I don’t know how you keep producing the product and staying with your livelihood and staying with your farm. And I think it leads some pretty serious decisions for those farmers.

Frederica Freyberg:

Now, this letter that Grassland sent to farmers April 1st apparently came as a surprise to many of those farmers. But was this something that state and federal officials have been watching and working on for months?

Ben Brancel:

Oh, for over a year. Back in early ’16 we started to worry about this change in policy that Canada was putting in place. We immediately started to have discussions with their ambassadors, the embassies, counselor generals. It was going through federal channels. We were trying to make sure that it would not get fully imposed. And we kept worrying about it. And eventually in March, end of March, Canada informed Grassland that that was the last loads of ultra-filtered milk they would be allowing into their country.

Frederica Freyberg:

What did your agency counseling the farmers affected or what kinds of resources should it come to pass that they cannot find a new market?

Ben Brancel:

Well, we want them to talk to us. We will help them walk through some of the decision-making process, what is it that they have to do to disburse the herd or would they sell the cows and keep the heifers with the opportunity to come back into the milking system. What kind of other things do we have to do? Do we have to mediate with the lenders to see if the lenders will help us give those farmers some latitude? So we’re standing at the ready. But most of our energy right now is to hope that that never happens and to work hard to see that it never happens.

Frederica Freyberg:

How bad is this?

Ben Brancel:

It's pretty bad for those farmers. I don’t care what you say about the industry, but when you know what can happen to those farm families, it’s bad.

Frederica Freyberg:

Meanwhile, in the midst of all of this and in an ongoing kind of effort, you’re working to expand markets in Mexico.

Ben Brancel:

Yes, we are, as we have been. We try to find locations where we think there’s an opportunity for products from the state of Wisconsin to be sold and build relationships. Those take time to happen, but we’ve been very, very successful. This state used to be ranked 17 amongst the states of the U.S. Today it’s ranked 12th. So our export market based on the other states and the numbers we’re given has improved.

Frederica Freyberg:

How could any renegotiation of the North American Free Trade Act from the Trump administration affect all of this and Wisconsin?

Ben Brancel:

Well, my hope is when they sit down and they take a look at NAFTA and if NAFTA allows this to happen and this is not — I just think there’s a spirit of the law and there’s the letter of the law. And I think Canada violated the spirit of the law. And if you have to really get to the letter of the law, then we have to open up that NAFTA agreement and make sure that this does not happen again, where they can target a very specific product and cause undue harm to our businesses here and certainly our farm families.

Frederica Freyberg:

Meanwhile, just ahead we are looking at the Department of Agriculture’s Farm to School program and that is a program that we started looking at because there’s a budget item that cuts the coordinator position and the advisory council for that program. But that was a cut that actually you recommended as part of kind of reining in costs in your agency?

Ben Brancel:

Well, the legislature required every agency to review all of its programs and find out if there was an opportunity for a 5% reduction. We listed a whole variety of items on that list for the legislature’s consideration and that was one of them, yes. It was one of those. And it’s because the position was vacant and had been vacant. We now have two other councils besides the advisory council working on this project. And we have other employees that we’ve redirected to work on Farm to School programs.

Frederica Freyberg:

All right. Secretary Ben Brancel, thanks very much for your time and good luck.

Ben Brancel:

Thank you.