By Jérôme Soucy
From Dairy Farmers of Canada website www.dairyfarmers.ca
For the past few weeks, Canada's agricultural supply management policies have been the focal point of numerous debates, especially in the context of the Trans-Pacific Partnership free trade agreement negotiations. In response, the Union des producteurs agricoles (UPA) launched the Strong and United for supply management campaign to show its support for keeping this quantitative production control method in several agricultural sectors, including milk production.
This morning, I read an article published by the Montreal Economic Institute called Viewpoint – Canada's Harmful Supply Management Policies. The two authors, Youri Chassin and Mario Dumais, argue that supply management places an unfair burden on Canada’s poorest consumers. In support of this argument, they cite a study by researchers from the University of Manitoba, which concludes that the percentage of income spent on the cost of supply management is five times higher for poor households than rich households.
There is a major flaw in this rationale: whether or not abolishing supply management would provide an additional $339 in buying power to the poorest 20% of households, we must bear in mind that this amount would also be subject to the laws of the market. In the absence of supply management, there would inevitably be greater volatility in terms of the cost of groceries, which would hit the budgets of low-income families, where there is little room for market volatility, the hardest. In addition, our country’s income tax policies already serve as a mechanism that strives to restore a balance between the rich and the poor.
The authors are particularly interested in supply management’s perceived effects on milk production, referring to the case of Australia, which got rid of milk quotas 15 years ago. What they don’t mention is that between 2000 and 2013, Australia's annual milk production decreased by more than 12%; whereas Canada's supply managed production increased by about 3% over the same period (source).
In actuality, the situation in Australia is quite different from the one in Canada, which makes comparisons difficult. The main reason for this is that Australia is an island, which significantly increases the shipping costs for foreign producers looking to export their milk there. This is not the case in Canada, whose closest neighbour is the world's largest milk producer. In fact, some Canadian cities are just a few hours by truck from the state of Wisconsin, which produces more milk than all of Canada together. To suggest that the federal government take inspiration from Australia on the sole basis that things did not go so badly there seems risky to me. The authors also fail to reference the case of Switzerland, where the situation has been equally as challenging.
Furthermore, to support their argument, the authors cite former Member of Parliament Martha Hall Findlay, who, in 2012, said that supply management has provided little incentive to farmers to innovate and become more productive. This passage bothered me quite a bit: I frequently come across agricultural entrepreneurs who are constantly innovating their practices, even though supply management is well established in Canada.
It brought to mind the example of the Coopérative d'utilisation de matériel agricole (CUMA), which emerged in Quebec several years ago. The cooperatives allow a group of farmers to purchase expensive equipment that they only use a few times a year, but which is still necessary to operate a farm. In my mind, reducing production costs is a great way to be more productive. I then thought of advances in milk production, whether through genetic engineering or herd feeding improvements. Now more than ever, Canadian sires are among the world's most sought-after for breeding. Wasn't the famous sire Starbuck from Ontario? Honestly, I think this former parliamentarian should be criticized in this context, rather than quoted in a positive light.
Recently, Minister Pierre Paradis spoke of the need for a law regarding animal welfare. I support this initiative and believe that other countries should follow suit. In the milk production sector, Canada has already opted to ban the use of the growth hormone bovine somatotropin. Meta-analyses have shown that, while it increases milk production, the use of this hormone has dire consequences on animal health, such as decreasing fertility, increasing the risk of udder infections, and occasionally causing lameness in some cows. And yet, by contrast, this hormone is legally used in the United States - I sincerely doubt that free trade agreement discussions will improve the health of American cows. The agreement could even lead to worse health consequences if the cows are forced to produce even more cheap milk for Canadians. Honestly, American milk leaves a bad taste in my mouth.
I conclude by reiterating that supply management by means of milk quotas is not just an efficient way of ensuring dairy farmers are paid decently; it's also a way of protecting a quality product that is produced with respect for animals and the environment. I would rather hear Minister Paradis quote Gandhi than read Chassin and Dumais quote Martha Hall Findlay.
Canada—and Quebec in particular, which accounts for 49% of Canadian dairy farms—is in no way inferior to other countries in terms of the productivity of its farmers. If you attended the World Dairy Expo in Madison, Wisconsin, last fall, you surely saw a cow from Notre-Dame-du-Bon-Conseil crowned the grand champion of the Holstein show, while a cow from Piopolis in the Estrie region brought home champion honours in the Ayrshire show.
Source: Dairy Farmers of Canada