China-US Trade Frictions: Escalating tariffs hit America's cheese makers

World
Europe

03:18

Among the counters unleashed by China and Mexico against the US are higher duties on American cheese. This comes on top of already-high tariffs on US dairy bound for Canada. Big dairy states like Wisconsin are nervous over how and when this trade war will end. CGTN's Hendrik Sybrandy has our report.

John Umhoefer/Wisconsin Cheesemakers Assoc. Exec. Dir: "Cheese is more than a cultural icon for us. It's big business in Wisconsin."

Blair Wilson/Sartori Cheese Vice President of Marketing: "You can find our cheese in Asia and Europe and South America."

Wisconsin dairy ad "Wisconsin has a long tradition of crafting the world's finest cheese."

It's a huge part of the state's identity and its livelihood. Cheese has put food on the table in Wisconsin for many, many years.

BLAIR WILSON VICE PRESIDENT OF MARKETING, SARTORI CHEESE "Sartori Cheese, our ambition is to make the best cheese in the world."

Blair Wilson works for a 4th generation family-owned business that makes gourmet cheeses. That's what Wisconsin is known for. 130 dairy farms supply the milk Sartori uses to make its products.

BLAIR WILSON VICE PRESIDENT OF MARKETING, SARTORI CHEESE "The neat thing about Sartori is that we buy that milk not based on a contract but a handshake."

One-tenth of Sartori's revenues come from cheese exports and, as with other cheesemakers, that number has been rising. But tariffs of up to 25 percent, just imposed by Mexico and China, two of America's largest cheese export markets, threaten to sour the situation.

HENDRIK SYBRANDY PLYMOUTH, WISCONSIN "Wisconsin calls itself America's dairyland. The milk and cheese industries are big here. So when tariffs threaten business in any way, that puts people on edge."

BLAIR WILSON VICE PRESIDENT OF MARKETING, SARTORI CHEESE "It's compressing our margins. It's making that business unprofitable."

JOHN UMHOEFER, EXECUTIVE DIRECTOR WISCONSIN CHEESE MAKERS ASSOCIATION "Our goal is to increase exports and we want great traders and we want to grow exports, so this is not good for Wisconsin."

The head of the Wisconsin Cheesemakers Association says more expensive U.S. cheese will only cause that cheese to pile up unsold, further depressing already low milk prices. He says China bought $50 million worth of Wisconsin dairy products last year and worries it will now look for other suppliers. Just as producers here may have to look for new customers.

BLAIR WILSON VICE PRESIDENT OF MARKETING, SARTORI CHEESE "This level of volatility makes it difficult from a planning aspect to make sure we're being profitable and doing the right things for our family farms."

Many in this state are sympathetic with U.S. President Donald Trump's attempts to redress what he sees as trade imbalances. But they don't want to see the tariffs drag on.

JOHN UMHOEFER, EXECUTIVE DIRECTOR WISCONSIN CHEESE MAKERS ASSOCIATION "It's not good but we're hoping that it's temporary. We're hoping that it's a part of negotiation and as it moves forward the tariffs will not stay at this level."

The E.U. already prevents companies like Sartori from selling cheese under names like parmesan and asiago.

BLAIR WILSON VICE PRESIDENT OF MARKETING, SARTORI CHEESE "The European Union is promoting very aggressively on a global basis to protect these common names and really go against decades of trademark law."

A dispute he says has been amplified by the current global trade environment. Sartori believes cheesemakers should compete on a level playing field. May the best man win.

BLAIR WILSON VICE PRESIDENT OF MARKETING, SARTORI CHEESE "My hope is that free trade will carry the day."

That's an open question in a part of the U.S. where tariffs are a particularly big deal. Hendrik Sybrandy, CGTN, Plymouth, Wisconsin.