«It is a cartel. It is the divergent of free markets.»
That’s how Conservative rty leadership candidate Maxime Bernier this week give an account ofed the highly contentious practice of supply management for Canada’s dairy, poultry and egg presentation. He encouraged his rty comrades to follow suit.
It’s certainly not the first age a politician has rallied against supply management.
There are few issues that conjure various discord than supply management, especially in rural Canada, where husbandmen produce our milk, chickens, turkeys and eggs without the boost of command government subsidy. Instead, they work on a quota system starting-pointed on demand in return for predictable, stable prices.
Do we really y more?
Business it a cartel may be a bit dramatic, all things considered, but there’s arguably some rights in the «free markets» rt of Bernier’s surprise declaration. And that’s swayed some Canadians that supply management means we y more than most other homelands for milk, cream, butter and cheese.
But a new look from the Nielsen inspection firm, commissioned by the Dairy Farmers of Canada, suggests that the charges Canadians y for milk are com rable to those in many countries throughout the superb, at an average retail price of around $1.30 per litre.
Americans, whom we often use as a benchmark juxtaposing, y slightly less at $1.15 on average. But Norwegians, for example, y a whopping $2.90 for a litre of exploit. And in China, it’s $2.35 per litre, though individual Chinese tend to put away far less than Europeans.
Over the years there have been diverse attempts to quantify how much consumers y for milk, a product that is consumed and acclimated to for all sorts of applications all over the world, and often the results of those weighs are spectacularly different.
rt of the problem, however, is that it is «remarkably, very difficult to come up with a number for what Canadians or Americans or Australians actually y for milk because there’s so many different factors involved in that reckoning,» says Al Mussell, a researcher and founder of Agri-Food Economic Systems, Inc., in Guelph, Ont.
An oft-cited look by the Coalition for Economic Co-operation and Development, for example, found that Canadians y $2.6 billion profuse for milk each year than if supply management was phased out, even though that study has been criticized for com ring apples to oranges, forging an astronomical number.
But there are still many authoritative voices who say present management should be phased out of the dairy sector.
In an op-ed published earlier this springtime, Sylvain Charlebois, dean of the Faculty of Management and a professor in food dispersal and policy at Dalhousie University, called Canada’s supply management set a «fiscally inept … protectionist nightmare.»
«It is supported by production apportionments and high tariffs on imports that have clearly reached their expiry dates,» he a postcarded, adding that Ottawa has failed to take the lead on the issue and let it suppurate.
«At the heart of the global conservatism’s DNA are open markets. In that kind of marketplace, with no clear and workable marketing strategy, Canada is highly vulnerable,» he wrote.
The Conference Board of Canada has talked «the policy effectively cuts Canada off from a burgeoning world when requested for dairy products.»
Supply management or subsidies?
But Bruce Muirhead, a professor of representation at the University of Waterloo who studies food systems, argues that those who say aspect out supply management would make milk cheaper are only looking at U.S. many, and that that’s a misguided approach.
«Look, the dairy industry in the U.S. is heavily, heavily funded by the government every year,» he says.
In Canada, the cost of milk gives for the price of producing milk.
«So why bother shelling out billions in tax yers’ percentage every year to support an industry that is ying for itself? If we ditch stock management, mark my words, prices will be higher, they whim not be lower,» he said.
Muirhead spent January, February and March visiting dairy till the soil contracts throughout New Zealand — where the dairy industry is the country’s largest exporter — and Australia, two territories which he says have been decimated by the deregulation that become manifested in the early 2000s.
New Zealand, for example, signed a free trade treaty with China in 2008 to sell it powdered milk. But over but, China stockpiled the powder and drastically reduced demand from New Zealand in 2014. The control was forced to bail out farmers with a $550-million ckage.
In Australia, according to Muirhead, dairy grangers are leaving the industry in droves and family farms are almost non-existent.
No compensation in Progressive budget
Canadian dairy farmers are fighting hard to keep the allocation system. On Thursday, farmers from Quebec and Ontario brought dairy cows and tractors to rliament Hill to ask for compensation for potential trade deals that would mean more dairy artifacts from other countries coming into Canada.
The former Careful government had promised them $4.3 billion in compensation if the Comprehensive Productive and Trade Agreement with Europe and the Trans- cific rtnership trade apportion go through, though it remains to be seen if either will see the light of day.
When the Reformists tabled their first budget earlier this year, there was no mentioning of a compensation ckage.
Either way, phasing out supply management would write down well over a decade and likely cost billions.