An administration proposal to close the U. S. southern border with Mexico would send shock waves through the U.S. dairy industry, closing off access to its largest dairy export market, said the U.S. Dairy Export Council (USDEC) and the National Milk Producers Federation (NMPF).
“The dairy industry is suffering through one of its worst economic periods ever,” said Jim Mulhern, president and CEO of Arlington, Va.-based NMPF. “Low milk prices are already creating hardship for farmers, and further supply disruptions would only prolong producer difficulties.”
More than seven dairy farms close each day in the United States, according to data from the USDA.
“Dairy exporters already are suffering from diminished access to export markets due to high tariffs and lack of progress on U.S. trade agreements,” noted Tom Vilsack, president and CEO of USDEC, also based in Arlington. “Closing the U.S. southern border to Mexico would be a gut punch that could set the industry back by a decade or two.”
Mexico is U.S. dairy’s largest export customer, purchasing $1.4 billion (USD) worth of products in 2018, USDEC and NMPF said.
“There is not a ready alternative market for the millions of gallons of milk that are converted into the thousands of tons of dairy ingredients and cheese we ship to Mexico,” Vilsack said. “It is very difficult to fathom the impact closing the U.S.-Mexico border would have on U.S. agriculture, and both the American and Mexican food industries.”
USDEC said it has spent more than two decades building the market for U.S. dairy products in Mexico. Mulhern and Vilsack noted that as bad as a southern border closing would be for the U.S. dairy industry, it will hurt their friends and colleagues in Mexico even worse, given the dependence of its consumers on U.S. products.
In a letter to members of the House and Senate, Rick Smith, president and CEO of Kansas City, Kan.-based Dairy Farmers of America (DFA), urged “immediate action to ensure the U.S.-Mexico border remains open to U.S. dairy exports.” DFA, owned by 14,000 dairy farmers across the country, expressed concern that the recent announcement risks the largest destination for American dairy products, accounting for more than one-quarter of all U.S. dairy exports.
“The dairy industry has worked together closely for more than two decades to grow and strengthen the market for U.S. dairy products in Mexico,” Smith said. “In the volatile dairy industry, strong dairy export markets are crucial for our farmer-owners, who have suffered years of financial stress on the farm. Mexico remains a key customer for our dairy farmer-owners, and we are asking Congress to work with the administration to keep our border open and quickly ratify the United States-Mexico-Canada Agreement (USMCA) to ensure our robust trade partnership continues.”