NAFTA talks

NAFTA talks are underway in Washington this week and Prime Minister Justin Trudeau says Canada will not rush to a bad decision just to meet the U.S. imposed Friday deadline.

Local farmers are counting on the government to protect the system. The Egger family own a dairy farm in Milton. They have 65 cows that are milked twice a day. Roland Egger says that supply management makes his family business viable. The system protects his production costs and ensures he can sell his milk.

“It provides quality, it ensures safeness, it ensures local product, and high standards. It keeps taxpayers from paying for us. The Americans have large subsidies we do not have.”

Supply management has been around in Canada since 1965. It applies to poultry, eggs and dairy. It basically means the farmer owns a certain percentage of the market, and they can only produce as much as their quota allows.The Eggers are allowed to fill a 4000 litre tank every two days.

“Why are all the country’s worried? It’s because they’re over producing. Over producing causes drops in prices, drops in prices makes it hard to make ends meet on the farm and with supply management we can not over produce.”

He worries about cheap milk being dumped from across the border.

The Canadian government has said it will not dismantle supply management, but President Donald Trump sounded optimistic today.

Marvin Ryder from the Degroote School of Business believes there may well be a deal by Friday. The U.S. already imports some milk products duty-free.

“We are not going to give up supply management, what will change is the amount the U.S. can bring into our market duty free.”

Ryder expects that the government is now negotiating how much U.S. dairy it will allow duty-free. Any new program would likely be phased in over a few years and there may be some sort of subsidy to support Canadian farmers and other initiatives to encourage people to continue buying Canadian.