Monday, in Wellington, New Zealand, Lockwood Smith, the country's international trade minister blasted U.S. policy in one-year government support programs aimed at providing incentives to encourage U.S. dairy exports to various foreign markets. Smith responded to U.S. export incentives announced on June 30 by saying that he is "frustrated that the U.S. is once again resorting to the use of export subsidies." According to news reports across the globe, he protests the use of supports in the current, shaky global economy, and considered them particularly ironic coming from the U.S., which has in recent years been fighting for free trade.
The supports in question are new one-year allocations and related incentives by the U.S. Dept. of Agriculture (USDA) and its new Dairy Export Incentive Program (DEIP) as well as a related poultry-related Export Enhancement Program. When the export incentives were unveiled, Agriculture Secretary Dan Glickman said they were necessary in order to "assist American producers and exporters facing unfair trading practices" in various product and geographic sectors. (See related article).
The DEIP bonuses allow supports for 76,207 metric tons of skim milk powder, 25,475 metric tons of butterfat, 3,190 metric tons of cheese and 2,518 metric tons of whole milk powder. New Zealand's own dairy industry accounts for about US$2 billion in exports and is obviously threatened by a more competitive and government-backed U.S. dairy export industry.