Canada is not the challenge for United States dairy, Trudeau says

"It's not Canada that's the challenge here", Trudeau said Thursday, saying the USA has a large dairy trade surplus with Canada.

Prime Minister Justin Trudeau met U.S. President Donald Trump's pointed criticism of Canada's dairy industry Thursday with calm counterarguments in defence of how Canada prefers to manage its milk.

"There's a recognition that the levers that the federal government has cover the entire country and the housing market in Vancouver or Toronto is somewhat different than that in Halifax or Saskatoon or even Montreal", Trudeau said in an interview with Bloomberg News.

Trudeau's comments come two days after Trump promised US dairy farmers he would intervene to restore exports of American milk to Canada.

"Every country protects for good reason its agricultural industries".

What's Trump's problem with Canada's milk?
According to the ambassador, American producers export five times more to Canada than they export to the south. New Brunswick, Quebec, British Columbia and Ontario producers were all represented.

"Canada, what they've done to our dairy farm workers, is a disgrace".

Trudeau was speaking in Toronto on Thursday and made his first response to comments from President Trump in which he said he'd push Canada to change its dairy system as part of the NAFTA negotiations.

Trudeau said the system, known as supply management, "works very well" in Canada. "Canada strongly believes in a rules-based system of trade, and therefore always abides by and upholds the rules that govern trade", she said in an e-mailed statement. "It's a disaster. It's a trading disaster", he said, saying his office would be "reporting back sometime over the next two weeks" on what it's going to do about the North American Free Trade Agreement. The threat to get rid of or alter NAFTA is a potential problem for Canada, whose biggest trade partner is the United States. He said it was caused by USA and global overproduction of milk. "We're not going to overreact". "He has shown if he says one thing and actually hears good counter arguments or good reasons why he should shift his position, he will take a different position if it's a better one, if the arguments win him over", Trudeau said.

US dairy groups appealed to Trump for help after Canada recently introduced a new policy that gives Canadian producers an incentive to buy domestic supplies of ultra-filtered milk, a concentrated ingredient used to boost protein content in cheese and yogurt.

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