Revamp Canada’s Dairy Supply Management Program, Or Lose Half the Industry
Canada should revamp its dairy supply management program over the next two decades by reducing tariffs and opening up domestic dairy market to more imports while building up an international brand for Canadian dairy products.
That is according to a study conducted by agri-researchers from Dalhousie University and the University of Guelph.
“Dismantling supply management is not a viable solution currently,” says the report. “If trade were liberalized tomorrow, cheaper American milk would likely flood the Canadian market, our farmers would not be able to compete, and eventually the entire dairy industry would be dependent on imported milk.”
But failure to reform the current program could still mean the loss of half of the country’s dairy farms, leaving it with just 5,500 farms by 2030.
The report estimates that new trade pacts—the Canada-European Union’s Comprehensive Economic and Trade Agreement and the Trans-Pacific Partnership—will together open up about 8% of the Canadian dairy market to international imports. (Other assessments show the U.S. Mexico Canada trade agreement will also marginally increase U.S. exports over current levels to Canada as well.)
The Canadian government has agreed to support its dairy farmers with $1.75 billion (Canadian) in aid over the next 8 years to compensate for increased imports. But that funding only amounts to “a Band-Aid on a wound that needs sutures,” says the Dalhousie/Guelp report.