Lahaina, Hawaii, July 28 (Reuters) – The United States, Canada and Japan have to make concessions on dairy trade before a wider Pacific trade deal can be wrapped up, New Zealand’s agricultural trade envoy said on Tuesday.
Mike Petersen, a farmer who represents the interests of New Zealand agriculture, said the dairy part of the Trans-Pacific Partnership negotiations was at an impasse.
During four days of meetings in Hawaii this week, TPP ministers hope to wrap up the 12-nation deal, which would cut tariffs and set common ground on issues such as environmental standards and intellectual property protections for 40 percent of the world economy.
“It’s like a set of dominos, we are waiting for one country to effectively make a move and that will trigger a whole lot of other things for other countries in the talks,” he told Reuters.
“The level of ambition for the dairy part of these talks is just not where we need it to be, and so we need some real movement over the next few days if we are going to get these talks concluded.
“We have got to see movement with Canada and the USA, Japan and New Zealand and Australia in particular, that’s where the dairy things lie,” Petersen said.
One TPP diplomat said countries were closing out issues of less importance, which boded well for reaching agreement on more contested issues this week.
While New Zealand and Australia are pressing for more dairy exports to U.S., Canadian and Japanese markets, U.S. milk producers are eyeing more access to Japan and Canada to make up for any extra imports into the United States from countries such as New Zealand.
Jaime Castaneda, senior vice president at the U.S. Dairy Export Council, said the U.S. industry was prepared to match other countries in cutting tariffs.
“Once Canada makes a credible market access offer, all the other pieces will fall into place,” he said.
According to material prepared for the meetings by the Dairy Companies Association of New Zealand, the European Union has 30 percent of global dairy trade, New Zealand has 17 percent and the United States 13 percent, with the U.S. share having tripled since 2003.
Within the 12-nation TPP trade network, the United States has nearly half the dairy market, compared with New Zealand at 30 percent. The majority of New Zealand dairy farmers will not break even this year, the presentation said.