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Next U.S. trade battle could be milked in Canada香蕉视频直播檚 dairy barns

Amid U.S. tariff threats, a fight may be brewing over Canadian supply management
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Cows are seen in a dairy farm in Granby, Que., on Feb. 5. THE CANADIAN PRESS/Christinne Muschi

The federal government and the Canadian dairy industry are vowing to protect the country香蕉视频直播檚 supply management system in the face of threats from the United States.

But some observers, and even some who work in the industry, say Canada will have to consider changes to the decades-old system that controls the supply of dairy products to appease a combative Trump administration.

Earlier this week, U.S. President Donald Trump voiced discontent about American access to Canadian dairy markets, which was a major sticking point in North American free-trade negotiations during his first term in office.

香蕉视频直播淐anada is very tough. They香蕉视频直播檙e very, very tough to do business with, and we can香蕉视频直播檛 let them take advantage of the U.S.,香蕉视频直播 he told reporters on Monday. 香蕉视频直播淭hey don香蕉视频直播檛 take our agricultural product for the most part, our milk and dairy, etc. A little bit they do, but not much. We take theirs.香蕉视频直播

Hours later, Prime Minister Justin Trudeau announced he had reached an agreement with Trump to pause proposed 25 per cent tariffs on Canadian exports for at least 30 days, in exchange for commitments to beef up border security and fight the fentanyl trade.

But it香蕉视频直播檚 unclear what will happen once that month elapses. In addition, the Canada-United States-Mexico Agreement, signed in 2018, will be up for review next year. As part of the free-trade deal, Canada agreed to allow U.S. dairy farmers access to about 3.5 per cent of the domestic market, but the U.S. has since accused Canada of violating the pact.

香蕉视频直播淲e will certainly see a fight. It will be a titanic battle,香蕉视频直播 said Lawrence Herman, an international lawyer and senior fellow at the C.D. Howe Institute. 香蕉视频直播淭he Americans are bound to challenge supply management.香蕉视频直播

Howard Lutnick, Trump香蕉视频直播檚 pick to lead the Commerce Department, also singled out the dairy industry during his Senate confirmation hearing last week.

香蕉视频直播淐anada 香蕉视频直播 treats our dairy farmers horribly. That香蕉视频直播檚 got to end,香蕉视频直播 he said. 香蕉视频直播淚香蕉视频直播檓 going to work hard to make sure 香蕉视频直播 they do much, much better in Canada than they香蕉视频直播檝e ever done before, and that is a key focus of this administration.香蕉视频直播

On Tuesday, Foreign Affairs Minister M茅lanie Joly told reporters the government will defend Canadian dairy producers. 香蕉视频直播淲e have always said that we would protect supply management,香蕉视频直播 she said. 香蕉视频直播淭he Liberal party is the party that put supply management in place, we are the ones who protected it during the last (free-trade) renegotiation, and we香蕉视频直播檒l be there to protect it.香蕉视频直播

Canada香蕉视频直播檚 system of supply management for dairy, poultry and eggs was established starting in the 1970s following a period of price volatility. It functions by setting production quotas for farmers, guaranteeing minimum prices and maintaining import controls.

Luc Boivin, general manager of Fromagerie Boivin in Quebec香蕉视频直播檚 Saguenay region, said the Americans have good reason to be unhappy with some elements of the system, including a lack of transparency about how minimum prices are fixed.

香蕉视频直播淚 think supply management will be protected in Canada,香蕉视频直播 he said in an interview. 香蕉视频直播淏ut I think it will have to be modernized.香蕉视频直播

He pointed to the fact that Canada agreed during the 2018 trade talks to scrap separate classes for certain milk ingredients that allowed producers to sell them at lower prices and made American equivalents uncompetitive.

However, U.S. officials have since claimed that Canada has effectively replaced those classes with a new one that continues to violate the principle of the trade pact. 香蕉视频直播淚 think this time the Americans will arrive much more prepared 香蕉视频直播 at the negotiating table,香蕉视频直播 Boivin said.

Herman went further, claiming the U.S. could demand major concessions on the dairy market. 香蕉视频直播淚 think that there will be serious, serious pressure from the Americans for Canada to not only give American dairy exporters greater access, but to do away with supply management entirely,香蕉视频直播 he said.

Charles Langlois, president of a Quebec industry group representing dairy producers, said that as far as he香蕉视频直播檚 aware, supply management is not currently on the table during tariff talks with the United States.

Concessions made during recent trade deals with the United States, the European Union and Pacific Rim nations have already opened about 10 to 12 per cent of the Canadian dairy market to other countries, he said.

香蕉视频直播淲e want to ensure that our supply management system is not affected, because it ensures a stable environment for the industry, it ensures a good product for consumers and good prices,香蕉视频直播 Langlois said.

Boivin said his four-generation family business has already felt the impact of those concessions, thanks to increased competition from imported cheeses. 香蕉视频直播淲e are not currently growing,香蕉视频直播 he said.

In 2023, the House of Commons passed a bill tabled by the Bloc Qu茅b茅cois that would have protected the supply-managed dairy, egg and poultry markets from future trade concessions. The legislation had broad support from all parties, but faced pushback in the Senate and died when Trudeau prorogued Parliament last month.

Herman called the bill 香蕉视频直播渁ppalling,香蕉视频直播 especially when Canada is facing a 香蕉视频直播渃risis of major proportions香蕉视频直播 with the U.S. 香蕉视频直播淚t香蕉视频直播檚 a reflection of the egregious hold that the dairy farmers of Canada have on politicians in Ottawa,香蕉视频直播 he said. 香蕉视频直播淎nd ultimately, it香蕉视频直播檚 about votes.香蕉视频直播

Doing away with supply management, he said, would remove a major trade irritant and allow Canadian producers to compete internationally.

But Jodey Nurse, a faculty lecturer at the McGill Institute for the Study of Canada, said Canadian farmers would struggle to survive if supply management were scrapped. 香蕉视频直播淲e would be flooded with dairy products, egg products and poultry products from the United States and elsewhere,香蕉视频直播 she said. 香蕉视频直播淎nd I do think that there香蕉视频直播檚 just no way that the Canadian producers would be able to compete.香蕉视频直播

She believes Trump香蕉视频直播檚 tariff threats will strengthen Canadians香蕉视频直播 resolve to defend the domestic dairy industry. 香蕉视频直播淚 think most Canadians and most people recognize that food is not just another widget,香蕉视频直播 she said. 香蕉视频直播淔ood is something that needs to be protected.香蕉视频直播





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