The U.S. dairy sector is applauding a series of new trade frameworks announced this week between the United States and four Latin American partners—Argentina, Ecuador, El Salvador and Guatemala—agreements that industry groups say will strengthen export opportunities across the Western Hemisphere. The U.S. Dairy Export Council (USDEC) and the National Milk Producers Federation (NMPF) both issued statements praising the frameworks, which target tariff and non-tariff barriers that have long limited access for U.S. dairy products.
The announcement comes at a pivotal moment for American dairy exporters, who have seen rapid growth in trade with Central America in recent years. According to the NMPF, U.S. dairy exports to partners under the U.S.-Central America-Dominican Republic Free Trade Agreement (CAFTA-DR) have nearly doubled in the last five years. With 2024 marking the first year in which all dairy tariffs under CAFTA-DR are fully eliminated, industry groups have been pressing for new commitments to ensure non-tariff obstacles do not undermine the benefits of the agreement.
“U.S. dairy exports to U.S.-Central America-Dominican Republic Free Trade Agreement partners have almost doubled over the past five years. The frameworks the administration has negotiated with Guatemala and El Salvador position our exporters to really capitalize on that landscape during the first duty-free year of dairy trade under the CAFTA-DR trade agreement by ensuring that nontariff trade barriers don’t slow our progress,” said Gregg Doud, president and CEO of NMPF. “Non-tariff barriers tend to sprout up like weeds when tariffs disappear, which is why these commitments are so important in this region. The nontariff commitments announced with Argentina and Ecuador also may help resolve multiple long-standing issues in those markets. Dairy farmers look forward to seeing the details on them as well as on the tariff commitments the deals include.”
The new frameworks with El Salvador and Guatemala include commitments to streamline product registration, eliminate apostille requirements, uphold previously accepted dairy certificates, and maintain open market access for products that use cheese terms often targeted in geographical indication disputes. They also include assurances of transparency regarding geographic indication practices—an issue that has frequently posed challenges for American cheese exporters.
For U.S. dairy producers, the Central American market has become increasingly important. Last year, U.S. dairy exports to Guatemala reached $127 million, while shipments to El Salvador totaled $50 million.
Krysta Harden, president and CEO of the U.S. Dairy Export Council, said the frameworks reinforce a long-term strategy to expand trade in free-trade partner markets. “The U.S. Dairy Export Council has been keenly focused on maximizing export opportunities into our FTA partner markets so that we make the most of markets where we have a level playing field against other competitors. Central America has been a key part of that strategy of growing our exports of cheese and other dairy products and creating partnerships that have been crucial to the economic wellbeing of our dairy farmers, which is why these frameworks with Guatemala and El Salvador are particularly welcome,” Harden said.
Turning to South America, the frameworks with Argentina and Ecuador address structural challenges that have hindered growth for U.S. dairy in those countries. Unlike Guatemala and El Salvador, Argentina and Ecuador do not have bilateral trade agreements with the United States, which has limited market access and contributed to relatively modest export levels—just $6 million in dairy exports to Ecuador and $3 million to Argentina last year.
The commitments with Argentina include eliminating facility registration requirements for U.S. dairy, maintaining open access for products using certain cheese terms, and granting preferential market access for what was described as “a wide range of [U.S.] agricultural products.”
The Ecuador framework may have the broadest commercial implications, with commitments to reform its import licensing system, revise facility registration rules, maintain access for cheese products regardless of labeling terminology, and “reduce or eliminate tariffs…[for] certain agricultural products [and] establish tariff-rate quotas on a number of other agricultural goods.”
Harden emphasized the importance of these measures in unlocking new opportunities. “Ecuador has the potential to be a good market, but too often nontariff barriers have impeded access to this and other markets where opportunities exist. The commitments the administration has secured on these topics in Latin America are crucial to avoiding those problems. Dairy exporters and farmers hope that the Argentina and Ecuador deals will deliver predictable access and also include additional market access, especially for dairy ingredients and cheese.”
Industry leaders expect the frameworks to help U.S. exporters secure more predictable and transparent access to regional markets, particularly as global demand for dairy ingredients and value-added cheese products continues to rise. While full details of the agreements have yet to be released, both NMPF and USDEC say the announcement represents meaningful progress toward addressing longstanding trade hurdles and expanding the sector’s footprint in Latin America.
As exporters await further clarification, the dairy industry is positioning itself to leverage the improved access expected from the new commitments and build upon recent growth in the hemisphere’s emerging markets.