The Uruguay Round Agreements Act (1995) directed the USDA to study the potential implications of the new General Agreement on Tariffs and Trade for Federal Milk Marketing Orders. This research was conducted to comply with that requirement. The analysis described in this publication incorporates revisions to the model used in the original analysis, reflecting extensions and updates developed in conjunction with another study (ct. Pratt et al., A Description of the Methods and Data Employed in the U.S. Dairy Sector Simulator, Version 97.3, R.B. 97-09, Department of Agricultural, Resource, and Managerial Economics, Cornell University, 1997). Of primary relevance here are changes in transportation costs which result in broader implications for North American trade in milk and dairy products.