What's GATT

The GATT Uruguay Round Agreement , now the World Trade Organization, requires the US and other countries to allow imports at a minimum of 3 % of domestic consumption at the start of the agreement, increasing it up to 5 % by the end of the six year implementation period. In other words and under this trade agreement, dairy farmers are guaranteed the 95 % of their local market.
The US exports are hampered by the fact that it's farm milk prices are higher than the low cost producers and exporters like New Zealand , Australia and Argentina.
If this surplus can not be sold in the international market, it will afect internal prices, lowering them down. This will push farmers to get into lower cost production systems, and get some grazing going on, in a first instance at least during the spring season, but will end up looking for year round grazing areas.

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