Progressive Conservative leadership candidate Maxime Bernier thinks that milk, eggs and chicken will be much cheaper for consumers if Canada gets rid of the supply-managed sector. He is so wrong.
Bernier says Canadians are paying two to three times the price of milk that they can buy across the border in the United States and as such, they will save $500 per year.
Large supermarkets in the U.S. sell milk as a loss-leader, especially in the border areas in order to attract Canadian shoppers. The U.S. is awash in milk but it’s not going at bargain prices elsewhere. I know of people in lower B.C. who cross the border for their grocery shopping at times and load up on certain items. Milk is cheaper just across the border but go farther down and you’ll find milk and eggs to be quite expensive. I have been in stores in the dairy states and found milk and eggs to be more expensive than in Canada.
If Canada does ever scrap its supply-managed system, which isn’t likely, and dairy farmers can produce all the milk they want, the retail price might drop a bit for a time and then go right back up since the store market would simply charge what the consumer would pay. And it wouldn’t matter what the farmers were paid for their product. Isn’t that the way it goes with beef during barbecue season?
Bernier says there’s no way to reconcile his free-market principles with support for Canada’s supply-managed agriculture sector, so he’s parting company with long standing party policy. He acknowledged that his move resembles a flip-flop.
As the minister for small business and tourism specifically, and as a Conservative MP since 2006 generally, he repeatedly voiced support for the supply-managed farm sector, a significant source of employment in his rural Quebec riding.
He told a CBC reporter, “I was not in a position to question the party’s democratic decision, or cabinet solidarity. And so I went along with it, even though I had grave misgivings about it for all these years.” He said he had the courage to speak for 35 million consumers against supply-managed farming.
The Conservative Party concluded a policy convention in Vancouver, BC recently and revisiting the party’s official support for supply management was not on the agenda.
Bernier said supply management could be wound down with a multi-year phase-out of the quota system and the import restrictions that protect it.
He said a “temporary levy” on food products could be used to raise funds to compensate farmers for the cost of their lost quota. That would increase the store price of milk.
The Canadian dairy industry disagrees with Bernier’s view that Australia is a success story, pointing to studies that show the prices consumers pay are not significantly lower than in Canada. Australia’s dairy sector has contracted in some areas and been stagnant in others.
“France, Germany, Belgium, Australia, New Zealand, Ireland, Iceland… they have all deregulated and right now they are all giving money to their farmers to preserve their national dairy industry,” said Isabelle Bouchard, a spokesperson for the Dairy Farmers of Canada.
