The May 17 announcement that the U.S. has agreed to lift its steel and aluminum tariffs on Canada and Mexico, removing major obstacles for ratification of the renegotiated North American free trade pact by all three countries. Mexico, in turn, lifted its retaliatory tariffs against U.S. cheese exports. The break in the logjam could improve dairy prices and the chances for passage of the U.S.-Mexico-Canada Free Trade Agreement and perhaps help end the trade dispute with China.
The USMCA contains provisions to boost U.S. dairy and poultry to Canada, establishes updated sanitary and phytosanitary controls, improves access for U.S. wheat and wine — among other things. But the primary benefit for U.S. farmers and ranchers is that it would maintain virtually zero tariffs between the three countries that were established in the current pact.
Meanwhile, the USDA’s preliminary 50-state data put April output up 0.1 percent, according to the May 20 Milk Production report. Output was 18.43 billion pounds, with output in the top 23 producing states at 17.4 billion pounds, up 0.3 percent. Revisions lowered the original 50-state March total by 40 million pounds, to 18.873 billion pounds, down 0.6 percent from March 2018.
Milk output will also likely be impacted down the road considering what weather is currently doing to crop planting. The latest Crop Progress report shows only 49 percent of the corn crop was planted, as of the week ending May 19, up from 30 percent the previous week, but down 29 percent from a year ago and 31 percent behind the five-year average; 19 percent of the corn has emerged, up from 10 percent the previous week but 28 percent behind a year ago and 30 percent behind the five-year average.
