Commerce Secretary Howard Lutnick breaks down reasoning behind a plethora of tariffs, reacts to trade criticism and reveals the ultimate goal for President Donald Trump’s negotiation tactics.
FIRST ON FOX: Canada is being called out by lawmakers for allegedly evading the United States-Mexico-Canada Agreement and not allowing fair access to the market for U.S. dairy producers.
“Historically, Canada has failed to live up to its commitments to provide access to its market; this remains the case even with new provisions in the United States-Mexico-Canada Agreement (USMCA),” Sens. Tammy Baldwin, D-Wis.; Roger Marshall, R-Kan.; and Joni Ernst, R-Iowa, said in a bipartisan letter to Department of Commerce Secretary Howard Lutnick, Department of Agriculture Secretary Brooke Rollins and U.S. Trade Representative Jamieson Greer.
According to the senators, Canada is going around guidelines outlined in the USMCA regarding protein exports at artificially low prices.
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Bipartisan senators are asking Trump’s Cabinet to address possible USMCA guideline evasion by Canada in the dairy sector as tariffs begin and trade talks heat up. ( / Reuters)
“In upcoming negotiations with your Canadian counterparts, particularly those regarding USMCA, we ask that you address these long-standing issues that harm the United States’ ability to export dairy products,” they urged.
The senators noted that the dairy sector in Canada operates under strict and predetermined circumstances. These include limits on production, pre-set prices and restricted imports, in order to guard the country’s supply management system.
Recent changes to the trade agreement were expected to improve this access to an extent, but the lawmakers claimed, “Canada is not fulfilling their commitments.”
“By exploiting a loophole, Canada exports excessive quantities of dairy protein at an artificially low price, negatively impacting global markets the United States relies on,” the letter said. The bipartisan group added that the “trade distorting behavior” has to be dealt with in order to keep dairy trade fair and support American producers.
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“Canada continues to manipulate access to its dairy market by reserving the vast majority of shares of their Tariff Rate Quotas (TRQs) for Canadian processors, causing fill rates to remain low across several dairy product categories, including whey powder, milk powder, and cheese for industrial use,” they said.
Wisconsin, where Baldwin hails from, was one of the top five milk-production states in 2023, according to the Department of Agriculture (USDA).
“For years, Canada has been skirting the rules and cheating American dairy farmers and businesses out of fair access to their market. We cannot miss this opportunity to help level the playing field, and I’m ready to work with President Trump to protect and grow Made in Wisconsin dairy and ensure fairness for our farmers,” she told Fox News Digital in a statement.
White House deputy press secretary Anna Kelly told Fox News Digital in a statement, “Democrats like Tammy Baldwin stood idly by as Joe Biden failed to enforce USMCA and allowed trade deficits to increase. President Trump will hold Canada and Mexico accountable to ensure that our hardworking farmers can export made-in-America goods on a level playing field.”
Their request comes as a trade war continues to escalate between the two North American countries.
Democratic Sen. Tammy Baldwin represents Wisconsin, one of the top five dairy-producing states. (Jemal Countess/for JDRF / Getty Images)
On Wednesday, President Donald Trump’s new 25% tariff increase on all steel and aluminum imports officially took effect. Tariffs had long been a part of his plan and were mentioned frequently on the campaign trail.
Initially, Trump planned to initiate blanket tariffs on Mexico and Canada, but delayed them after discussions with Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum.
Baldwin and Roger Marshall, R-Kan., accused Canada of evading the USMCA agreement. ( / Reuters)
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In retaliation to the Wednesday tariffs, Canada unleashed its own multibillion-dollar markups. “Today, I am announcing that the government of Canada, following a dollar-for-dollar approach, will be imposing, as of 12:01 a.m. tomorrow, March 13, 2025, 25% reciprocal tariffs on an additional $29.8 billion of imports from the United States,” said Canadian Finance Minister Dominic LeBlanc. “This includes steel products worth $12.6 billion and aluminum products worth $3 billion as well as additional imported U.S. goods worth $14.2 billion.”
Representatives for the Canadian prime minister, Lutnick, Rollins and Greer did not provide comment to Fox News Digital in time for publication.
