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I think that it is interesting to consider this in relation to the renegotiations of NAFTA where Canada's dairy supply management [1] was put in the spotlight.

I think that it is interesting to consider this in relation to the renegotiations of NAFTA where Canada's dairy supply management [1] was put in the spotlight. For those that don't know some details about Canada dairy supply management [2]: > The model, which matches domestic demand with domestic supply through a quota system, is particularly well-suited to a commodity like milk, where 40 percent is consumed locally. Supply management is designed to even out the peaks and valleys of producer income, and in this endeavour, it has been successful. It also allows farmers to plan for the longer term, which is particularly important when producing a commodity subject to the whims of the cow’s natural production. Despite supply management going against free trade ideals most of the farmers I know do like it. It lets them keep the lights on and maintain family farms that have been running for generations, but on the other hand it costs consumers both in their pocketbooks and variety of choice. [1] https://www.cbc.ca/news/politics/canada-supply-management-explainer-1.4708341 https://www.cbc.ca/news/politics/canada-supply-management-ex... [2] https://www.cigionline.org/sites/default/files/cigi_paper_30.pdf https://www.cigionline.org/sites/default/files/cigi_paper_30...

ip26 8y ago
Everybody likes being part of the protected market. That's part of the problem- "Well if you're going to protect dairy, and you want my support, how about you protect my steel too?" (repeat, repeat, repeat)
- dleslie 8y ago
  It's a managed market. If consumer trends in Canada shifted away from dairy it would not somehow survive. Instead, dairy farmers collaborate to avoid production waste and to coordinate for seasonal/cyclical changes in demand and production.
  - Scoundreller 8y ago
    It’s hard to imagine higher prices without milk users getting creative. Lots of products that should be made with butter are made with oil. Alfredo sauces made with soybean oil instead of cream. The products that have these substitutions will have a greater discount and more sales. Frozen pizza makers slacking on cheese toppings. Processed cheese. And that’s just the industrial use side.
    - dleslie 8y ago
      Interesting that your list is entirely processed foods. Probably best never to buy such products at all, and if you do, you probably aren't the sort that cares whether the fat is from butter or from canola.
      - Scoundreller 8y ago
        But the products exist because people buy them as cheaper substitutes, reducing dairy demand. Milk drinkers will just drink less when the price is higher (sometimes voluntarily, sometimes involuntarily).
        dleslie 8y ago
        Or do they buy them because they're convenient? Or do they buy them because they're cheaper than restaurant or take-out alternatives? Or do they buy them because the packaging is appealing? Regardless, processed food is generally shit, everywhere. Discerning health and quality conscious consumers in any nation aren't likely to favour purchasing processed food.
- gerbilly 8y ago
  I'm from Canada[1] and supply management protects more than just a market. It protects the landscape too. Factory farms pollute the surface and groundwater. The big corporate players will fight hard protect their right to dump their 'externalities' (read manure) in the cheapest way possible. Sadly, because uncontaminated land and water is not accounted for in the 'market', they will likely succeed. [1] AND I grew up in a dairy farming area.
  - ucaetano 8y ago
    You don't need supply management to do that. Not only that, supply management is a terrible way to do that.
    - gerbilly 8y ago
      If you meant the EPA, it looks like it isn't doing too great job of protecting the land either if peoples taps are running with manure like the article shows.
    - dleslie 8y ago
      We look and learn from our neighbours to the South, and what outcomes we see down there generates strong public support to maintain the system we have. Frankly, as a consumer, American dairy, beef, poultry and produce make me nervous.
      - gerbilly 8y ago
        I never eat any animal products when travelling in the US. They are of much lower quality, and full of hormones and additives.
      - ucaetano 8y ago
        > generates strong public support to maintain the system we have. Oh, yeah, everyone loves a protectionist market, when they're part of it...
        8y ago
- sandworm101 8y ago
  Don't mention steel in relation to US-Canada trade. Canada is extremely unhappy to see China's steel constantly exempted while Canadian steel is subject tariff. As other posters have pointed out, Canada's protected dairy market is about far more than keeping farms going. It is about regulating a stable food supply and associated external impacts.
  - microcolonel 8y ago
    > Canada's protected dairy market is about far more than keeping farms going. It is about regulating a stable food supply and associated external impacts. Canadians do consume a fair amount of dairy in global terms, but honestly it's not a big part of most people's diets by calories. If dairy got more expensive for a few months, or a decade, or forever, people would just buy less of it. If it got less expensive, those inclined might buy more of it sometimes. There is no moral or practical benefit to to Canadian society at large in "stabilizing" the dairy supply, if the current regime could even be considered that.
    - dleslie 8y ago
      There's also that the Canadian Food Guide just dropped dairy as an essential food group. https://food-guide.canada.ca/en/ https://food-guide.canada.ca/en/
- lancewiggs 8y ago
  "American government contributed around $22.2 billion in direct and indirect subsidies to the dairy sector in 2015." That's over double the amount that New Zealand's dairy sector (grass fed, not housed in sheds) makes from exports each year. Not only is the industrial US system inefficient and subsidised, but the milk quality is poor as well. And let's not avoid the question of burping cows and Methane emissions. https://www.realagriculture.com/2018/02/u-s-dairy-subsidies-equal-73-percent-of-producer-returns-says-new-report/ https://www.realagriculture.com/2018/02/u-s-dairy-subsidies-...
wbl 8y ago
And the consumer who desires fine French cheeses or the single mother who wants to give her children milk are less important because? If milk was cheaper there would be more demand for it. Of course the farmers like it.
- MAGZine 8y ago
  I think we could do a better job opening markets to products that we don't have here, like cheeses from around the world. I do hate when people use others as pawns in their arguments though. Are you a single mother unable to afford milk? Inevitably when it comes to talking about economics, the poor/single mothers/etc are always trotted out on stage as reason we need to cut taxes/change the way we do business.
  - deskamess 8y ago
    The poster is allowed to empathize with another party. However, I took would like to open the market to cheese. Let the consumer tolerate if they want to buy 'bad' cheese or, as advertised by the proponents, the 'better' Canadian cheese. Let the consumer choose.
    - MAGZine 8y ago
      In my experience, when it comes to market ideology and taxes, people don't argue from empathy, they argue from the pocketbook. In this case, they're arguing from _someone else's_ pocketbook. And it's not the dairy farmers pocketbook or average citizens exposed to global markets pocketbook.
- cbhl 8y ago
  > the single mother who wants to give her children milk are less important The Canadians thought of that too! They give parents a refundable tax credit of $5481-6496/year per kid under 18, and that's just at the federal level. https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4114/canada-child-benefit.html#P161_9469 https://www.canada.ca/en/revenue-agency/services/forms-publi... Plus, basic groceries (like milk, bread, vegetables) and feminine hygiene products have 0% sales tax: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-gst/charge-gst-hst.html https://www.canada.ca/en/revenue-agency/services/tax/busines...
dleslie 8y ago
We also once had a managed market for wheat sales, but the last Tory government ended that. I went and bought rail stocks in anticipation for the inevitable outcome where individual farmers would pay more for access. Rail has done well. Wheat farmers less so.
- badpun 8y ago
  > I went and bought rail stocks in anticipation for the inevitable outcome where individual farmers would pay more for access. Tangent - I don't know any other country in the world where the public is actively picking stocks like this. Given that, it's probably bad for the majority of people, I wonder if, at some point of US history, it was pushed upon people by some PR campaign (for example, by the finance companies who profit from it).
  - dleslie 8y ago
    Buying rail is a bit of a tradition in Canada, given how immensely important the rail lines are to our country. They're traditionally somewhat of a safe bet, with reasonable dividends.
- randomdata 8y ago
  > We also once had a managed market for wheat sales You're probably thinking of tobacco, which lost its supply managed status in 2009 under the Tory government you speak. Wheat was never supply managed in Canada, only diary, poultry, and formerly tobacco. Wheat and barley operated under the single desk principle. The mandatory pool operated by the CWB, which the Tories also shut down, only applied to western provinces. Ontario had/has its own wheat board, now known as Grain Farmers of Ontario. Ontario farmers voted to eliminate the mandatory pool in the late 90s and was completely phased out by 2003, although an optional pool remains.
  - dleslie 8y ago
    It wasn't supply managed in the way that dairy was, but the CWB negotiated for rail access on behalf of independent farmers. And yes, I'm aware of Ontario's actions. My rail stocks continue to do well. Choo choo!
motohagiography 8y ago
The question I can't seem to find a consistent answer to is whether closing/limiting a market from imports/exports has the same net effect of supply management. Supply management is for smoothing out volatility, but one major source of that volatility is exogenous demand from futures and far away competition. Dairy economics worked fine when they were bound by geography. What broke the economics is industrial scale operations optimized for exporting from the region. The policy solution for that to keep farmers alive and dairy available would be to impose borders on the markets. European (French) dairy subsidies are a variation on supply management, where instead of centralizing production, they close their borders to imports and redistribute general revenue as a way to maintain culture. The consequence of supply management is that you can't just start a dairy farm in Canada with a few cows and some land. While that may seem trivial, distortions like this mean small towns are not economically viable because there is little local production that produces economic activity. It makes dairy management a fundamental cultural problem. I would be interested in a sound comparison of the tradeoffs between supply management vs. borders/tarrifs to solve the same problem.

ip26 8y ago

Everybody likes being part of the protected market. That's part of the problem- "Well if you're going to protect dairy, and you want my support, how about you protect my steel too?" (repeat, repeat, repeat)

dleslie 8y ago
It's a managed market. If consumer trends in Canada shifted away from dairy it would not somehow survive. Instead, dairy farmers collaborate to avoid production waste and to coordinate for seasonal/cyclical changes in demand and production.
- Scoundreller 8y ago
  It’s hard to imagine higher prices without milk users getting creative. Lots of products that should be made with butter are made with oil. Alfredo sauces made with soybean oil instead of cream. The products that have these substitutions will have a greater discount and more sales. Frozen pizza makers slacking on cheese toppings. Processed cheese. And that’s just the industrial use side.
  - dleslie 8y ago
    Interesting that your list is entirely processed foods. Probably best never to buy such products at all, and if you do, you probably aren't the sort that cares whether the fat is from butter or from canola.
    - Scoundreller 8y ago
      But the products exist because people buy them as cheaper substitutes, reducing dairy demand. Milk drinkers will just drink less when the price is higher (sometimes voluntarily, sometimes involuntarily).
      - dleslie 8y ago
        Or do they buy them because they're convenient? Or do they buy them because they're cheaper than restaurant or take-out alternatives? Or do they buy them because the packaging is appealing? Regardless, processed food is generally shit, everywhere. Discerning health and quality conscious consumers in any nation aren't likely to favour purchasing processed food.
gerbilly 8y ago
I'm from Canada[1] and supply management protects more than just a market. It protects the landscape too. Factory farms pollute the surface and groundwater. The big corporate players will fight hard protect their right to dump their 'externalities' (read manure) in the cheapest way possible. Sadly, because uncontaminated land and water is not accounted for in the 'market', they will likely succeed. [1] AND I grew up in a dairy farming area.
- ucaetano 8y ago
  You don't need supply management to do that. Not only that, supply management is a terrible way to do that.
  - gerbilly 8y ago
    If you meant the EPA, it looks like it isn't doing too great job of protecting the land either if peoples taps are running with manure like the article shows.
  - dleslie 8y ago
    We look and learn from our neighbours to the South, and what outcomes we see down there generates strong public support to maintain the system we have. Frankly, as a consumer, American dairy, beef, poultry and produce make me nervous.
    - gerbilly 8y ago
      I never eat any animal products when travelling in the US. They are of much lower quality, and full of hormones and additives.
    - ucaetano 8y ago
      > generates strong public support to maintain the system we have. Oh, yeah, everyone loves a protectionist market, when they're part of it...
      - 8y ago
sandworm101 8y ago
Don't mention steel in relation to US-Canada trade. Canada is extremely unhappy to see China's steel constantly exempted while Canadian steel is subject tariff. As other posters have pointed out, Canada's protected dairy market is about far more than keeping farms going. It is about regulating a stable food supply and associated external impacts.
- microcolonel 8y ago
  > Canada's protected dairy market is about far more than keeping farms going. It is about regulating a stable food supply and associated external impacts. Canadians do consume a fair amount of dairy in global terms, but honestly it's not a big part of most people's diets by calories. If dairy got more expensive for a few months, or a decade, or forever, people would just buy less of it. If it got less expensive, those inclined might buy more of it sometimes. There is no moral or practical benefit to to Canadian society at large in "stabilizing" the dairy supply, if the current regime could even be considered that.
  - dleslie 8y ago
    There's also that the Canadian Food Guide just dropped dairy as an essential food group. https://food-guide.canada.ca/en/ https://food-guide.canada.ca/en/
lancewiggs 8y ago
"American government contributed around $22.2 billion in direct and indirect subsidies to the dairy sector in 2015." That's over double the amount that New Zealand's dairy sector (grass fed, not housed in sheds) makes from exports each year. Not only is the industrial US system inefficient and subsidised, but the milk quality is poor as well. And let's not avoid the question of burping cows and Methane emissions. https://www.realagriculture.com/2018/02/u-s-dairy-subsidies-equal-73-percent-of-producer-returns-says-new-report/ https://www.realagriculture.com/2018/02/u-s-dairy-subsidies-...

wbl 8y ago

And the consumer who desires fine French cheeses or the single mother who wants to give her children milk are less important because? If milk was cheaper there would be more demand for it. Of course the farmers like it.

MAGZine 8y ago
I think we could do a better job opening markets to products that we don't have here, like cheeses from around the world. I do hate when people use others as pawns in their arguments though. Are you a single mother unable to afford milk? Inevitably when it comes to talking about economics, the poor/single mothers/etc are always trotted out on stage as reason we need to cut taxes/change the way we do business.
- deskamess 8y ago
  The poster is allowed to empathize with another party. However, I took would like to open the market to cheese. Let the consumer tolerate if they want to buy 'bad' cheese or, as advertised by the proponents, the 'better' Canadian cheese. Let the consumer choose.
  - MAGZine 8y ago
    In my experience, when it comes to market ideology and taxes, people don't argue from empathy, they argue from the pocketbook. In this case, they're arguing from _someone else's_ pocketbook. And it's not the dairy farmers pocketbook or average citizens exposed to global markets pocketbook.
cbhl 8y ago
> the single mother who wants to give her children milk are less important The Canadians thought of that too! They give parents a refundable tax credit of $5481-6496/year per kid under 18, and that's just at the federal level. https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4114/canada-child-benefit.html#P161_9469 https://www.canada.ca/en/revenue-agency/services/forms-publi... Plus, basic groceries (like milk, bread, vegetables) and feminine hygiene products have 0% sales tax: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-gst/charge-gst-hst.html https://www.canada.ca/en/revenue-agency/services/tax/busines...

dleslie 8y ago

We also once had a managed market for wheat sales, but the last Tory government ended that. I went and bought rail stocks in anticipation for the inevitable outcome where individual farmers would pay more for access. Rail has done well. Wheat farmers less so.

badpun 8y ago
> I went and bought rail stocks in anticipation for the inevitable outcome where individual farmers would pay more for access. Tangent - I don't know any other country in the world where the public is actively picking stocks like this. Given that, it's probably bad for the majority of people, I wonder if, at some point of US history, it was pushed upon people by some PR campaign (for example, by the finance companies who profit from it).
- dleslie 8y ago
  Buying rail is a bit of a tradition in Canada, given how immensely important the rail lines are to our country. They're traditionally somewhat of a safe bet, with reasonable dividends.
randomdata 8y ago
> We also once had a managed market for wheat sales You're probably thinking of tobacco, which lost its supply managed status in 2009 under the Tory government you speak. Wheat was never supply managed in Canada, only diary, poultry, and formerly tobacco. Wheat and barley operated under the single desk principle. The mandatory pool operated by the CWB, which the Tories also shut down, only applied to western provinces. Ontario had/has its own wheat board, now known as Grain Farmers of Ontario. Ontario farmers voted to eliminate the mandatory pool in the late 90s and was completely phased out by 2003, although an optional pool remains.
- dleslie 8y ago
  It wasn't supply managed in the way that dairy was, but the CWB negotiated for rail access on behalf of independent farmers. And yes, I'm aware of Ontario's actions. My rail stocks continue to do well. Choo choo!

motohagiography 8y ago

The question I can't seem to find a consistent answer to is whether closing/limiting a market from imports/exports has the same net effect of supply management. Supply management is for smoothing out volatility, but one major source of that volatility is exogenous demand from futures and far away competition. Dairy economics worked fine when they were bound by geography. What broke the economics is industrial scale operations optimized for exporting from the region. The policy solution for that to keep farmers alive and dairy available would be to impose borders on the markets. European (French) dairy subsidies are a variation on supply management, where instead of centralizing production, they close their borders to imports and redistribute general revenue as a way to maintain culture. The consequence of supply management is that you can't just start a dairy farm in Canada with a few cows and some land. While that may seem trivial, distortions like this mean small towns are not economically viable because there is little local production that produces economic activity. It makes dairy management a fundamental cultural problem. I would be interested in a sound comparison of the tradeoffs between supply management vs. borders/tarrifs to solve the same problem.