Ottawa Offering Dairy Sector $350 Million to Soften Impact from Canada-EU Trade Deal

The federal government is committing $350 million to helping the dairy sector adjust to increased import competition under the Canada-European Union trade deal (CETA).

Agriculture Minister Lawrence MacAulay announced two new programs at the Central Experimental Farm in Ottawa on Thursday.

$250 million over five years will be made available to producers to update their equipment and improve productivity. The adoption of robotic milkers, automated feeding systems, and other herd management tools, were cited as examples.

Another $100 million over four years will help processors modernize their operations to improve efficiency.

“The government strongly supports supply management,” said MacAulay. “Canada’s dairy producers and processors are vital to the prosperity and clean growth of our nation. They create jobs and offer high-quality products for Canadian consumers. These programs will help Canada’s dairy sector become more productive in order to help it adapt to the anticipated impacts from CETA.”

Dairy Farmers of Canada welcomed the announcement, but noted it only partially addresses the impact caused by CETA.

“With today’s announcement, the government has taken a significant step in demonstrating their commitment to supply management, and to the continued innovation and growth of Canada’s dairy sector; for that, DFC gives thanks,” said Wally Smith, president of DFC. “However, in order to ensure the continued sustainability and viability of supply management, there is still work to be done and the government has a significant role to play.”

DFC says the EU deal “will result in an expropriation of up to 2% of Canadian milk production; representing 17,700 tonnes of cheese that will no longer be produced in Canada. This is equivalent to the entire yearly production of the province of Nova Scotia, and will cost Canadian dairy farmers up to $116 million a year in perpetual lost revenues.”

Details of how the $350 million will be disbursed will be established through future consultations, according to DFC.

Dairy farmers’ concerns about domestic regulations and border measures were not addressed in the announcement “as the government led us to believe they would be,” noted Bruno Letendre, President of Les Producteurs de lait du Québec (PLQ) and member of the DFC Board of Directors.

“I am hopeful that the government will balance today’s announcement with concrete action to stop further damage to Canadian dairy farmers to show they fully support the supply management system,” said Letendre.

Prior to the federal election in late 2015, the Conservative government committed $4.3 billion to help the supply-managed dairy and poultry sectors adjust to the impact of both CETA and the Trans-Pacific Partnership.

MacAulay said the Conservative’s trade compensation package was announced with little consultation during the heat of the election campaign.

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