Trade war. Sounds scary. And it is. As a Canadian dairy farmer, my farm and family is directly in the crosshairs in this fight. That cold sick feeling in the pit of our stomachs has returned yet again as we wait to hear what the future holds for us. Will we survive this latest attack on our livelihood? Will scenes like this soon only be a memory in rural Canada?
President Trump’s latest tirade against our country’s dairy supply management system and his demands to dismantle said system are frankly quite frightening. But what is most frustrating is the lack of background or real facts in his claims of unfair trade practices in dairy between the US in Canada.
Supply management means that our Canadian dairy farms produce enough milk for Canadian consumers. In order to keep this balance between demand and supply, our government has trade barriers in place in the form of tariffs on dairy imports. Foreign countries are able to import milk to Canada, but they will be charged a high tariff (up to 300%). This cost is often prohibitive to imports and so Canadian processors usually rely on domestic dairy supply. But… Canada does allow some tariff free imports – about 10%. This percentage has been increasing in recent years; CETA and the new TPP have whittled away a sizeable chunk of our dairy market. But get this: this 10% is more than double the amount that the USA allows. Say what??? Yes, you read that correctly. The US caps tariff free imports at about 2.75%. So, the US ALSO protects their dairy industry. Ironic, huh? Yet, President Trump has attacked our system. You see, American dairy farmers are in dire straits. They produce much much more milk than is needed in the States and export a rather significant percentage to other countries, Canada included. The global dairy market is saturated, there’s simply too much milk. This has driven the price paid to American farmers below the cost of production, pushing many farms out of business. It’s understandable then that Trump would look for ways to alleviate these problems. But expecting entirely free dairy trade with Canada to fix this problem is ludicrous. With a population 1/10th the size of the States’, our market is too small to make a very significant dent in their current surplus. Wisconsin alone produces more milk than all Canadian farms combined. The US needs to manage their own issues with over supply rather than expecting us to fix their problems. Our own farmers do a fine job of supplying our citizens with dairy products, thank you very much.
And if the border were opened, what would be the cost? Our current system ensures a fair price paid to farmers that covers the cost of production. American dairy farms are already producing milk at a loss, and Canadian farms would soon follow suit. Small farms unable to compete with the economies of scale present on mega dairies with tens of thousands of cows would be the first to go. Farms like ours. Family farms. Our rural fabric would be forever changed. Is that what Canadians want?
If you want the dairy products you enjoy to be produced on Canadian farms, under the strictest animal welfare, milk quality and food safety standards in the world, it’s time to speak up. Let your elected officials know that your Canadian dairy products and dairy farmers are important to you. Reach out to your MP. Send an email to the Prime Minister’s office. Do anything you can to encourage our government to stand firm, to not give in to Trump’s bullying tactics. If they don’t, this photo may one day be one of the only reminders of the farms that used to dot our countryside. Let’s work together to make sure that doesn’t happen.
In Udder News... 
First of all, You do not supply enough milk for the Canadian market. Allowing 10% of the market into Canada tariff-free should be your first clue. Secondly, the world does not overproduce dairy. No such thing. American Dairy farmers are NOT in dire straights. Why do you not do something about or at least complain about Quebec’s share of the milk quota? How silly can you be, thinking your product is somehow of better quality? These points are childish silliness!
Take this advice from Jordan Peterson: “Stand up, tell the truth and be responsible for yourself.”
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We can supply enough to fill our market, but we’re not permitted to do this due to the recent concessions granted in trade agreements.
I’m friends with many American farmers and they’re literally hanging on by their finger nails. Maybe ask a farmer yourself! This article details the global milk glut and dairy dumping taking place in the US: http://time.com/4530659/farmers-dump-milk-glut-surplus/
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Correction: You are not permitted to because you have to tow the line of the Cartel of which you are a member. The Cartel NEEDS to import butterfat because it can not supply the Canadian demand. Your Cartel will not allow you to supply cheese makers, or yogurt makers, or raw milk buyers, or Ice Cream makers because they believe in what they are doing. It is no different a mindset than that of the communists who thought they could out-perform the market and organize it properly. They were wrong and so is anyone that thinks they can predetermine what the market is and what the price should be.
American agriculture is rife with subsidies, terrible, destructive and counter-productive but this need not affect us. It only does if we choose to take the low road with them. The immorality involved does NOT justify following suit and degrading our own business morality. Two wrongs do not make anything right.
Here is a free book in PDF form: https://mises.org/library/human-action-0
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Thank you for all your work in putting out information and explanations of our industry. I’m a fellow BC Dairyfarmer who works hard everyday to feed our country. I too have a young family that I want one day to pass our 4th generation farm on to. I believe one good point that we often overlook is that SM has played a massive role in happy health cows that produce high quality milk. And also that our farms often grow in size to bring on more family members as partners so they too can raise their families as they were raised not to industrialize their farms. Please keep up the good work in supporting our fellow farmers.
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Hello, thank you for writing this post. I think you did a great job explaining the global market of dairy and how Canada is currently protecting our market with tariffs. Though the last paragraph you make some statements that I would really like to know more about. Could you elaborate how the animal welfare is better under Canadian farmers compared to American farmers. How do we determine milk quality? Are there any metrics that we can measure and compare one milk vs the other. How are the Canadian food standards different from American ones. I find that when these points are properly explained to people the common person will stand up for these tariffs. Else I’m afraid people will enjoy cheaper cheese. Thank you for your writings.
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Canadian dairy farmers are required to adhere to our ProAction initiative. This program includes animal welfare, milk quality, traceability, and food safety requirements, with environmental and bio security segments coming up in the future. The animal welfare segment – the Code Of Practice for the Care and Handling of Dairy Cattle – has been praised by the Canadian Humane Society as being the best & most comprehensive Code of its kind in the world. Under the milk quality segment, we are held to strict quality standards regarding somatic cell count (the measure of white blood cells in milk that indicate the health of the cow) – our levels are capped at 400 000, while the US is permitted to process milk at 750 000 cells/mL. Under the Food Safety segment, we are required to carefully document and monitor our milk cooking and equipment cleaning records. In short, we have a mandatory, nation-wide program in place that is the most comprehensive of its kind – anywhere in the world. If you’d like to learn more about the ProAction initiative e, you will find more information here: https://www.dairyfarmers.ca/proaction#animal-care
I hope this answers your question; if not, please ask for further clarification. Thanks for your interest!
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Oops, **cooling** was autocorrected to *cooking* Sorry about that!
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