Historically, butter and milk powder have accounted for the overwhelming share of dairy exports to Mexico. These exports are typically concessional or subsidized sales destined for use in Mexico's government-sponsored feeding programs. This shift away from subsidized exports of bulk commodities towards unsubsidized commercial exports of value-added dairy products is an extremely important development that cannot be overemphasized in significance. Dairy-based desserts, such as ice cream, are increasing in popularity with Mexican consumers. One current exporter of fluid milk and related dairy products attributes as many as 150 jobs in one of its plants to be possible just because of the additional business it now enjoys in the Mexican market.
Relationships are easier to develop, and problems are easier to resolve than ever before.
Canada Unfortunately, the same cannot be said with respect to dairy trade with Canada. Canada's dairy product markets remain highly insulated from foreign competition, including U.S. competition. This does not mean that dairy trade with Canada is nonexistent. Overall dairy exports to Canada have been moderately expanding, although most of the trade, and the trade growth, has been in dairy product categories outside of the import restrictions related to the dairy supply management regime. The largest category of dairy product we export to Canada, for example, is whey, which last year represented 25 percent of our dairy exports to Canada.