U.S. dairy industry organizations are urging the European Union to avoid imposing excessive sustainability and due diligence requirements on American dairy farmers and companies. The National Milk Producers Federation (NMPF) and the U.S. Dairy Export Council (USDEC) submitted comments to the EU on August 13, calling for changes to the implementation of its Corporate Sustainability Due Diligence Directive.
The organizations responded to an EU public consultation on guidance materials for the directive, which requires companies operating in the bloc to identify, prevent and address environmental and labour-related risks across their supply chains.
Concerns Over Supply Chain Data Demands
The EU directive could lead companies to transfer extensive data requests, audits and compliance obligations to upstream suppliers. NMPF and USDEC warned that this approach could place additional pressure on U.S. dairy farmers, even when they do not directly supply an EU-based buyer or when their milk is used in products sold outside Europe.
The groups argued that European sustainability standards should not be imposed on U.S. farms that already operate under American laws and regulatory systems. They also called for due diligence requirements to focus on direct suppliers rather than extending broadly across entire supply chains.
According to the organizations, small and medium-sized businesses, including individual dairy farms, should be exempt from invasive information requests that may be difficult and costly to fulfil.
Calls for Recognition of U.S. Standards
NMPF and USDEC urged the EU to recognise the United States as a lower-risk jurisdiction when assessing sustainability and labour-related risks. They recommended that EU companies rely primarily on official government records and use compliance with U.S. law as the appropriate benchmark for American operations.
Such measures would reduce the possibility of EU companies demanding extensive documentation from U.S. processors and farmers. The groups said the EU should focus its regulatory measures on production practices within its own borders rather than attempting to dictate global environmental and labour standards.
The organizations also argued that any data requests made by companies covered by the directive should be limited to direct suppliers and should exclude small and medium-sized enterprises.
Impact on U.S. Dairy Exports
The EU’s Corporate Sustainability Due Diligence Directive could have implications for U.S. dairy exporters if European buyers require suppliers to provide detailed information about farming practices, emissions, labour conditions and other sustainability indicators.
While larger processors may have the resources to manage additional reporting obligations, smaller farms and suppliers could face higher administrative costs. These requirements could create barriers for companies seeking access to the European market and increase compliance expenses throughout the dairy supply chain.
NMPF and USDEC believe that a more targeted approach would maintain sustainability objectives while avoiding unnecessary burdens on producers that already comply with established U.S. regulations.
U.S. Government Support and Proposed Legislation
NMPF is also pressing the U.S. government to raise the issue during ongoing trade negotiations with the European Union. The organization is supporting the Stop EU Overreach Act, introduced in July by Representatives Craig Goldman, Jodey Arrington and Greg Steube.
The proposed legislation would direct the U.S. Trade Representative to initiate a Section 301 investigation into EU sustainability measures with extraterritorial reach. The investigation could include the due diligence directive and examine whether trade tools should be used to protect U.S. businesses from overreaching foreign policies.
Comments submitted by the U.S. Trade Representative to the EU reportedly reflected several of the concerns raised by NMPF and USDEC.
Outlook for Dairy Trade Relations
The dispute highlights growing tensions between sustainability regulation and international agricultural trade. While the EU seeks stronger accountability for environmental and labour practices across supply chains, U.S. dairy organizations argue that implementation must respect national laws and avoid disproportionate demands on farmers.
The final impact will depend on how the EU develops its implementation guidance and whether it accepts proposals to narrow the scope of supplier obligations. For U.S. dairy exporters, clearer and more proportionate rules could help maintain market access while limiting additional compliance costs.