June 14, 2018
Right Honorable Justin Trudeau
House of Commons
Dear Prime Minister Trudeau,
We understand that you are under enormous pressure to give up Canadian interests in the negotiations with the USA in order to reach a new NAFTA deal. President Trump is using highly unfair arguments, especially when he targets tariffs that protect Canadian supply management. The USA, like European countries, offers enormous price support programs to farmers in general and dairy farmers in particular. They do that in order to enable farmers to survive an extreme low world-market price for dairy, caused, among other factors, by the American and European dairy producers’ double-digit production increases. Canadian farmers did not cause this glut — because they have production discipline they do not over produce. In Canada we don’t need a government subsidy program, as our supply management system rewards efficient dairy farmers sufficiently from the market place. A recent study by Dairy Farmers of Canada (DFC) and executed by AC Nielsen Canada, showed that dairy products in Canada are 17% less expensive than in the U.S.
We are in close contact with farm groups in the USA who are organizing to get supply management systems off the ground in their country. After studying and understanding the benefits of the Canadian system, these farm groups are squarely opposing President Trump’s NAFTA demand for dairy concessions from Canada. They see supply management as the only way for American dairy farmers to survive.
It is paramount that the Canadian government protects supply management for farmers’ sake, as well as for consumers and the tax-payer. Impairing it would be costly for government in terms of creating bailout programs for farmers and Canadian consumers would pay likely higher prices for lower quality.
We urge you to stand firm in the protection of Canadian supply management.
Already other trade agreements have watered down protection for supply management. This needs to stop. Supply management is an economic backbone for rural Canada and it has proven to be an example that others want to emulate.
Please show leadership and stand firm.
Vice-President Policy, National Farmers Union
CC: Hon. Chrystia Freeland, Foreign Affairs Minister; Hon. Lawrence MacAulay, Agriculture Minister