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Dairy Farmers’ Success Faces Real Threat

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One suspects that the Canadian Wheat Board export monopoly is the real target of the government’s trade vexation.

It seems every year now the steadiest and most profitable producers in Canadian agriculture, dairy farmers, have had to fight for their very existence. One might think that the threat to their livelihood comes from a volatile marketplace, or disease, or border restrictions or some weather calamity. No, the real threat comes from the Canadian government, which seems determined to see this sector reduced to the have-not status of many other ag commodities. It’s as if the government wants to punish success.

This year saw a Canadian government trade official arrive at the annual meeting of the Dairy Farmers of Canada and state that producers better be prepared for more competition from dairy product imports. He implied that the protection of Canada’s supply management sector was no longer as secure as it once was at World Trade Organization (WTO) discussions. At present Canada uses a tariff structure of as much as 300 per cent to keep out cheap foreign dairy products, mostly cheeses.

Domestic supply management and tariff walls have allowed Canadian producers to supply the dairy market in an orderly manner that returned a profit to them for their controlled production. No, it’s not a free market, but it has meant stability, profitability and security to one of the few sectors of agriculture in this country. That should be a good thing.

But the Canadian government seems to want to change that good thing so that dairy producers can also enjoy low prices, market volatility, loss of equity and bankruptcy – just like producers in some other ag sectors. It would seem the government also wants to be able to subsidize a stricken dairy sector when markets collapse – just like some of the other ag sectors. It boggles the mind.

One suspects that the Canadian Wheat Board export monopoly is the real target of the government’s trade vexation, and that the other supply management sectors are just going to have to be sacrificed in what is really an ideological battle.

Now on the other hand, one might surmise that throwing dairy producers to the lions is being done for some noble purpose that will benefit the majority at the expense of the minority. Well, not exactly. We are to understand that Canadian government negotiators feel they are alone at WTO discussions in defending supply management and it’s a losing battle.

That’s curious, the U. S. and the EU are notorious for maintaining import quotas, tariff walls and bogus health barriers against Canadian exports such as beef, pork, sugar, dairy products, GM grains and oilseeds, etc. They don’t seem to feel alone in enforcing those trade restrictions, and it would appear that they have no intention of giving them up at WTO discussions in exchange for Canada abandoning supply management.

It gets even worse, the EU now plans to introduce export subsidies to get rid of surplus dairy products. When those subsidies are added to the already low world price of dairy products they may be in a position to overcome the 300 per cent tariff wall Canada has in place. What is the Canadian government planning to do about that blatant subsidy scheme? Probably not much, if the past is any lesson.

Twenty years ago the EU was subsidizing the export of cheap Irish beef into Canada. The cattle industry at great expense, time and effort took steps, through trade action, to stop that outrageous practice which was so detrimental to Canadian beef markets. I recall at the time the Canadian government was more of a hindrance than help and even tried to broker a deal in favour of the imports – which the Canadian cattle industry trade negotiators thankfully refused. You do wonder sometimes who Canadian trade and regulatory bureaucrats are working for.

The tiresome old song that we hear to justify giving up supply management is that it will open up new markets to other Canadian ag products. Really, who believes the EU with its strident, irrational opposition to hormones, antibiotics and GM products will actually open up its markets? Will new markets really increase prices back to producers? Perhaps, but don’t hold your breath – most commodities are subject to ruthless price competition in the world marketplace. Only crop disasters seem to create any new price/access opportunities in world markets for many Canadian ag exports.

To this point, the Canadian dairy industry owes its very existence to the fortunate situation that a very big chunk of it is located in Quebec. Because three political parties owe their political fortunes to that province, all will support supply management, at least on the surface. I suspect that without that big political stick, supply management in this country has a precarious future indeed.

SUSAN CHURCH MOVES ON

Susan Church, long-time and only manager of the Alberta Farm Animal Care Association (AFAC), has decided that after 15 years at the helm its time to retire.

Susan was the heart and soul of AFAC and became the best-known and most-visible spokesperson for animal welfare across Canada. There are very few in the Alberta livestock industry who have not heard this dedicated lady speak passionately about not just animal welfare, but the need to always continue to raise the bar, to be ahead of the regulators and extremist groups.

For Susan it was not an easy task to guide a fledgeling organization to become one of the premier AFAC groups on the continent. First she had to deal with moulding a diverse group of often competing livestock organizations into buying into a vision and a goal. Imagine dealing with producers who wanted to not only react by striking back at animal rights zealots and their outrageous allegations, but wanted to see instant action right now! It didn’t help that not all groups were as generous financially as they could have been to support AFAC.

Next, she had to wrestle with government regulators and bureaucrats who were not always helpful in supporting AFAC and had their own agendas. She also waged a war of nerves with established groups like the Alberta SPCA who saw AFAC as a threat to its hegemony. She persevered and in the end governments and others saw the wisdom in creating an all-encompassing Alberta-based animal welfare program. For that alone Susan deserves the livestock industry’s gratitude.

Under Susan’s guidance AFAC led the way in proactive programs designed to educate and prevent welfare problems, not react to them after the fact. That approach has thwarted duplicitous animal rights groups at every turn.

Fifteen years ago myself and Joanne Lemke of the Alberta Beef Producers were given the task to find a manager for AFAC. At that time we knew there could only be one person with enough enthusiasm, dedication and gumption to take the organization where it needed to go. Susan, thank you for your selfless contribution to the Alberta livestock industry.

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