The Trade Subcommittee of the House Ways and Means Committee has recently been accepting input on a variety of bills that have languished during the current session of Congress, including H.R. 1786, legislation that would impose tariffs on imports of casein and Milk Protein Concentrate (MPC).

Many in the dairy industry, including DFA, asked the House of Representatives to pass the dairy tariff legislation for the following reasons:

1. U.S. farm-level dairy prices have been depressed by a surge of imported dairy proteins – primarily MPC and casein – that are displacing domestically-produced dairy proteins in a variety of end uses, such as cheese. Foreign exporters, through the circumvention of U.S. trade regulations and the heavy use of subsidies, have taken advantage of poorly-negotiated trade agreements, especially the 1994 GATT agreement.
2. During the four-year period of 1994-1997, MPC imports averaged 42 million pounds per year. During the subsequent four-year period, 1998-2001, MPC imports averaged 107 million pounds per year, hitting a high of 143 million pounds in 2000. The amount of this MPC in the year 2000 is equivalent to about 276 million pounds of nonfat dry milk (NDM), and equivalent to an average of 210 million pounds during the four years between 1998 and 2001.
3. The net economic effect of these imports is that U.S. dairy farm income has been reduced by $1.12 billion. That figure takes into account how these added imports have negatively affected supply and demand in the U.S. dairy sector. Additionally, nonfat dry milk displaced by imported dairy proteins is often then purchased by the USDA’s price support program, leading to increased taxpayer costs. NMPF calculates that MPC imports alone have cost the government’s Commodity Credit Corporation a cumulative sum of $890 million since 1994.
4. The existence of tariffs on related dairy imports, such as skim milk powder and cheese, is evidence that U.S. policymakers intended to provide certain assurances to America’s dairy farmers that a level playing field between them and other dairy exporting nations would be established by Congress.
   

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