Local dairy operators are fearful a proposed free trade agreement the president is negotiating with Australia may negatively impact their future business.
Terms of the agreement are scheduled to be released this week, and early indications are that Australia is seeking free trade of dairy products into the United States, according to Matt Letourneau, a spokesperson for U.S. Sen. Pete Domenici, R-N.M.
Domenici and U.S. Rep. Tom Udall, D-N.M., are calling for a trade agreement that protects America’s dairy farmers.
Early analysis estimates that expanded market access to Australia would cost the American dairy business roughly $2.5 billion in lost revenue and hundreds of thousands of lost jobs, either directly or indirectly, according to a Jan. 27 letter Udall sent to President Bush.
“I request that you ensure that our dairy industry, especially dairy producers, will not suffer undue hardships if this agreement is put in place,” Udall wrote in the letter.
Domenici and U.S. Sens. Russ Fiengold, D-Wis., and Larry Craig, R-Idaho, signed a bipartisan resolution on Wednesday calling for a free trade agreement with Australia that will protect America’s dairy farmers.
“The dairy industry is a growing economic force in New Mexico in terms of revenue and jobs,” Domenici said in a press release. “Any trade agreement with Australia should not work to stifle its growth.”
Roosevelt County dairy operator Alva Carter Jr. is opposed to Australia’s requests in the proposal.
Carter said if passed the agreement would eventually allow other countries to trade milk through Australia into the United States, where overproduction of milk has been a problem in previous years.
“If this passes it’s not going to be good for the dairy industry in our area,” Carter said.
Carter operates the Roosevelt County-based Carter’s Milk Factory with his brother Alan Carter and father Alva Carter Sr.
“I think I can speak for most dairymen in saying we don’t mind fair trade, but we sure dislike free trade,” said. “I think there’s a big difference.”
Sr. said the price a dairyman pays to operate in the United States — including insurance, taxes and minimum-wage standards — makes it difficult to compete with dairies in foreign countries.
“We just can’t compete, and we really don’t want to,” Carter Sr. said. “We really want them to bring their standard of living up to ours.”
The agreement must be ratified by the U.S. Senate and the House of Representatives before it takes affect. But senators and representatives from states where dairy and sugar industries thrive are cautioning the president about Australia’s desire for free trade in both industries, said Glen Loveland, a spokesperson for Udall.
Loveland said new law does not permit amending trade agreements in the House or Senate.
Whatever agreement the president proposes must be either accepted or rejected as it is written.
New Mexico is the ninth-leading dairy producing state in the union, having increased production 400 percent since 1990. Roosevelt and Curry counties are among the among the state’s best in dairy production.