Source: POLITCO'S MORNING AGRICULTURE, 2/17/18

POLITICO Europe sat down with former U.S. Secretary of Agriculture Tom Vilsack on Thursday for a chat, particularly on his role as president of the U.S. Dairy Export Council. Chief among his concerns: Canada's dairy policy. He added that he thought that the EU should gets its hands dirty on the issue, too, POLITICO Europe's Emmet Livingstone writes.

Here's the background: The Canadian government sets fixed prices for milk and slaps tariffs on out-of-quota imports to help offer its farmers protection. However, Canadian dairy farmers have been griping that American producers have been flooding Canadian cheesemakers with so-called ultrafiltered milk - a type of milk filtered through a membrane in order to increase protein content - to their detriment.

This production technique was developed after NAFTA, and so ultrafiltered milk avoids quotas. Canadian producers now have a surplus of skim milk powder, and in response, Ottawa created a new pricing program for it - dubbed Class 7 - that the U.S. argues is far below market price and effective shuts U.S. companies out of that market.

Vilsack described the pricing move as "typical of our Canadian partners" and added that he had raised the issue with European Commissioner for Agriculture Phil Hogan, who reportedly told him that Brussels is also frustrated with Ottawa because it's allegedly fiddling with quotas in order to block European cheese imports. 

Origin label troubles: Vilsack warned that EU risked courting trouble with the World Trade Organization because of food origin-labeling plans mushrooming around the bloc, Emmet reports. "It can be a slippery slope," Vilsack said, arguing that dairy origin labels could set the stage for more protectionist measures in the future.