WASHINGTON, May 17 — The top US trade official slammed a Canadian decision to keep in place restrictions on imports of American dairy products, and said Washington is considering “next steps” in response.

Ottawa published policies on Monday that Washington says do not resolve the complaint over restricting a large share of American products, including milk, butter, yogurt and ice cream, to Canadian processors, limiting market access for US dairy under a system known as tariff rate quotas (TRQs).

US Trade Representative Katherine Tai said she was “deeply disappointed by Canada’s announcement.”

“Our top priority remains ensuring that US workers, producers, farmers, and exporters benefit from the market access they were promised under the United States-Mexico-Canada Agreement,” she said in a statement Monday.

American dairy groups are calling for the administration to retaliate with tariffs on Canadian goods, saying it is required by the USMCA trade pact, which came into force July 1, 2020, replacing the 1994 North American Free Trade Agreement.

“Canada made a clear choice to thumb its nose at both the United States government and its international treaty obligations. It has completely disregarded the USMCA agreement signed just a few short years ago,” said Jim Mulhern, president of the National Milk Producers Federation (NMPF).

Tai said her office “will evaluate all options... as we determine our next steps in the coming days.”

Washington in January won a dispute against Ottawa in the first case resolved under the new trade pact — known in Canada as Cusma — over the dairy TRQs, which reserve dairy products imported under preferential tariffs to domestic producers. 

USTR said the policy undermines the ability of US exporters to sell a wide range of products to Canadian consumers.

Canada’s International Trade Minister Mary Ng said in her announcement Monday, “We are confident that the new policies fully comply with the panel’s findings and its recognition that Canada has the full discretion to administer its TRQs under Cusma in a manner that supports Canada’s supply management system for dairy.”

While she said Ottawa “takes its commitments and obligations under international agreements seriously,” she again vowed to “always stand up for” the domestic industry. — AFP