Free trade talks raise concerns for some local farmers

Americans demand end to supply-management system

Chris Groenendijk gets up at three in the morning every day to tend to his 150 cows and do other chores on his 300-acre dairy farm in Westholme.

Groenendijk took over the farm from his parents in 1993 and he and his family have worked hard since then to build it into the thriving enterprise that it is today.

He said he loves the work, despite the long hours and constant demands, and refers to it as more of a lifestyle than just a job.

Groenendijk has four children and his dream is for at least one of them to take over the reins at the farm in future years as he looks to retirement.

But those dreams may be in jeopardy as Canadian supply-managed food producers like Groenendijk are being targeted by the American Trump administration in the ongoing and acrimonious trade discussions around renewing the North American Free Trade Agreement.

Supply management limits the amount of a particular product being produced through the use of a quota system, so that the market doesn’t get flooded with excess, which creates an unstable marketplace and drives prices down for producers.

Canada currently levies tariffs on imported dairy products, including 270 per cent on milk, 245 per cent on cheese and 298 per cent on butter, in an effort to restrict imported products and tightly control supply.

The egg, poultry, and sugar industries in Canada are also protected by the supply management system.


But U.S. President Donald Trump says Canada will have to dismantle its supply-managed system during the ongoing free trade talks or else Americans will dramatically curtail its trading relationship with Canada.

Groenendijk said there is no question that the Canadian dairy industry, worth an estimated $21 billion, would collapse without massive government subsidies if the Canadian negotiators give in to the American demands.

He said supply management has already been significantly chipped away by the government’s various international trade deals that incrementally allow for more daily products to be imported into Canada, and acquiescing to the American demands may be the final straw.

Groenendijk said the American dairy industry is at least 10 times the size of the Canadian industry, and American dairy farmers receive large subsidies from their government, while Canadian farmers receive none.

“Canada will be swamped with American milk and our industry would be swallowed up by theirs,” Groenendijk said.

“People think dairy prices will go down, and they probably will initially, but the retailers will adjust the prices and take the profits in the end.”

Groenendijk said there is a lot of misinformation about dairy farmers out in the public that just isn’t true.

He said there is a belief that the Canadian dairy industry is a monopoly that is gouging the public.

“The truth is that for the amount of work I do, I’m not making any kind of fortune here, and neither are any of the other dairy farmers I know,” he said.

Groenendijk said he has been watching the free trade negotiations with great interest, and he’s getting mixed messages from the Canadian government as to how they to intend to address supply management.

“They publicly say that they support us and recognize that it’s a good system and that’s encouraging,” he said.

“But in the end, it’s public opinion that will save or sink us.”

Alistair MacGregor, MP for Cowichan-Malahat-Langford and NDP critic for agriculture and agri-food, said he was proud last week to stand with the NDP’s International Trade Critic Tracey Ramsey who proposed a motion unanimously adopted by all parties in the House of Commons which called for a united stand against unfair trade tactics by the Americans.

He said Parliamentarians are committed to the defence of Canada’s supply management system, and that critics of the system contend that it leads to artificially high prices that hurt consumers.

“What they fail to realize is that our products are often on par or very close in price with those in other countries,” McGregor said.

“In fact, recent reports have found that some products, such as milk, have been cheaper in Canada than in Australia, New Zealand, and the U.S. The domestic focus of our supply-managed sectors has created stability and predictability for farmers and consumers alike that is lacking in export-focused systems. In fact, other countries have often had to intervene with government subsidies to farmers to help mitigate the effects of price fluctuations.”

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