Although Canada’s milk supply management system has resolved some longstanding issues for the country's dairy farmers, it has reduced the industry’s overall economic competitiveness and performance and complicated Canada’s international trade relationships, according to a new report released by the Conference Board of Canada. The report, “Canada’s Supply-Managed Dairy Policy: How We Got Here," concluded that Canada’s supply management system has made its dairy industry “stagnant compared to other countries” and that the success of the Canadian dairy industry has come at a cost.
“Canada’s competitor country dairy industries have seen significant milk market growth while in aggregate, Canada has seen no growth in overall milk volumes despite large increases in both population and income,” the authors noted.
The Conference Board report mirrors the findings of the 2010 Informa Economics report, prepared for IDFA, which concluded that consumption growth for fluid milk, cheese and butter has been slower or declining in countries with supply management. The Informa report, "An International Comparison of Milk Supply Control Programs and Their Impacts," also found that supply management programs have constrained dairy industry and job growth in the European Union and Canada and created an economic incentive for imports.
A similar supply management program is proposed for the United States dairy industry as part of the Dairy Security Act, which is included in the Farm Bill that awaits Congress when it returns from recess next week. IDFA opposes the program because, as shown by the Canadian experience, it would stifle both export opportunities and future investment in the industry.
"Congress should consider the findings of this report and reconsider the compromise, bipartisan Goodlatte-Scott amendment, which would leave the provisions of the Dairy Security Act 80 percent intact but remove supply management," said Jerry Slominski, IDFA senior vice president of legislative and economic affairs. “The question is whether we want to grow or remain the same."
