Trump trade rep targets Canada's beer and dairy rules in new CUSMA review conditions

U.S. President Donald Trump's point-person on trade laid out a series of conditions Wednesday that Canada must meet in order to extend the Canada-U.S.-Mexico agreement (CUSMA) when it comes up for a review next year — revealing publicly for the first time what the administration expects Prime Minister Mark Carney to do to keep the pact for the long term.

U.S. Trade Representative Jamieson Greer told Congress that CUSMA has been "successful to a certain degree" but there need to be changes before Trump agrees to extend it for another 16 years or revert to yearly reviews, something Canada is eager to avoid given the resulting annual uncertainty.

"I don’t think we can say that USMCA is an unqualified success," Greer said in his remarks, which were shared publicly after his closed-door meeting with lawmakers on Capitol Hill.

While Greer said the deal has turbocharged American exports to Canada and Mexico — they are up 56 per cent since 2020, according to his figures — "the shortcomings are such that a rubber stamp of the agreement is not in the national interest."

Greer said his office will "keep the president’s options open, negotiating firmly to resolve the issues identified, but only recommending renewal if resolution can be achieved."

That rhetoric is a departure from Trump's past characterizations of the trilateral trade deal he brokered in his first term. At the time, the president called CUSMA "the best agreement we’ve ever made."

Greer said the U.S. will take aim at two major Canadian policies: the Online Streaming Act, which brought online platforms like Netflix, Spotify, and YouTube under Canadian broadcasting rules, and the supply-managed dairy sector, among others.

Greer said for the CUSMA review to be successful Canada must bolster "market access for U.S. dairy products," and address "Canada's exports of certain dairy products," an apparent reference to claims that the Canadian sector allegedly dumps milk ingredients cheaply, undercutting American producers.

While he didn't call for supply management to be dismantled entirely — something that Canada has repeatedly stressed is a non-starter — he told Congress that Canada has policies that "unfairly restrict market access" and they must be dealt with.

Canada does allow some U.S. dairy products to trade into Canada tariff-free, but there is a limit — and American suppliers have never reached it. Still, the U.S. dairy lobby wants those rules loosened somewhat.

Greer also said that that Trudeau-era streaming legislation "discriminates against U.S. tech and media firms," and there needs to be some sort of revision of that policy, although he was not prescriptive in his remarks.

That legislation was brought about to force U.S. web giants to contribute financially to the domestic media ecosystem and make Canadian content readily available on their platforms, which have become ubiquitous as traditional TV, cable and satellite providers shed subscribers.

Greer also wants Canada to address the "provincial bans on the distribution of U.S. alcohol beverages," which came about as a form of protest to Trump's aggressive tariff action on key sectors like steel, aluminum, autos and lumber. 

Those liquor boycotts have been hugely impactful. U.S. spirits giant Brown-Forman, the maker of Jack Daniel's, has seen its Canadian sales plunge by more than 60 per cent.