OTTAWA — For the seasonal salad at the popular Oz Kafe here, the shavings of Gouda cheese are a salty and delicious culinary accompaniment. To the United States, they are an element of an increasingly bitter trade dispute over dairy products, one that threatens to undermine its decades-long agreement with Canada.
Canada’s longstanding policy of managing its dairy supply with production quotas and high levies on imports has become an intractable sticking point in negotiations over the North American Free Trade Agreement, one that risks scuttling a 25-year-old pact that has stitched together the economies of Mexico, Canada and the United States.
President Trump has seized on the practice as unfair and insisted that he is willing to jettison Canada by the end of the week if it does not drop its dairy tariffs of 270 percent. On Tuesday, the chief trade negotiator for the United States, Robert E. Lighthizer, said Canada was “not making concessions in areas we think are essential” including “issues of dairy.”