Canada-Europe Trade Deal Raises Concerns

As legislation to end the Canadian Wheat Board s monopoly marches closer to reality, there is growing speculation that this country s supply management sector will be next on the free marketers hit list.

It s in the government s and the WTO s (World Trade Organization) agenda, they want to ensure there is an endless supply of raw materials at very low prices no matter who suffers, and I can tell you this is going to come off the backs of our farmers, said Ian Robson of the National Farmers Union in a recent interview. Supply management better look out, they re next.

He said attacks on supply management are nothing new, but believes supply management opponents are looking to gain ground in the wake of Bill C-18; pushes to end other single-desk systems are inevitable.

But when you throw politics into the mix, you get a different outlook, says Sylvain Charlebois, associate dean of research at Guelph University s College of Management and Economics.

Untouchable

The Conservative government owes its majority to Ontario, a place where supply management is king, said Charlebois. They don t want to touch that.

He added the public also has an affinity for products produced under supply management, like eggs and milk, that make them feel like stakeholders. That is not the case with wheat and barley, which means public support for the CWB hasn t been as fierce as it might have been.

Therese Beaulieu, spokesperson for Dairy Farmers of Canada (DFC) agrees with the associate dean, despite a recently launched campaign by the Canadian Restaurant and Food Service Association (CRFA) calling for an end to the dairy supply management system.

There is nothing new under the sun. The restaurant association has been doing this for years, she said. I would not call it a change in the culture around supply management.

Beaulieu added it s important not to perceive increased visibility of an issue, as a sign of changing attitudes.

Some editorials here in Ottawa are generally keen to say the current government is not being coherent with their policies, but I do not see a change in the culture, she said.

Inconsistencies

Pundits have pointed to inconsistencies between the federal government s stance on the CWB and its apparently steadfast protection of supply management as it negotiates the Canada- European Comprehensive Economic and Trade Agreement (CETA ).

The government is still very much in the position that they will not give access to our supply management, said Beaulieu.

However, Robson doesn t take the government s statements about CETA seriously.

All that is for public consumption, and so far it seems the current government isn t interested in governing based on facts, he said. This government says they are going to support farmers, but I only see them supporting large companies on the backs of farmers.

Robson said prior to marketing boards, industries like dairy faced volatility and farmers had difficulty making a living. He doesn t want to see the clock turned back.

Keystone Agricultural Producers supports supply management chains, but its chairman said it is difficult to predict the effect of future trade agreements on domestic policy.

The system as it is provides benefit and we need to explain why this is important, said Doug Chorney. But it is going to be a challenge to complete that deal (CETA ) and have supply management untouched.

Outside pressures

Charlebois doesn t discount the effect of international trade organizations either.

If there are changes made to supply management, it would come from outside pressures, he said, noting the WTO may be one of those organizations applying pressure. But the academic said any changes to domestic supply management are unlikely in the next 15 or 20 years.

Charlebois added dismantling a quota system actually costs a government money, pointing to examples in Korea and Australia where the end of supply management resulted in an 18 to 20 per cent tax on certain items to recoup government losses.

Claims made by groups like the restaurant association suggesting ending supply management would lower consumer prices are not firmly grounded, he said.

It s very difficult to know what would happen to retail prices if supply management ended. said Charlebois. In the short term you may actually have an increase in prices.

David Wiens, Dairy Farmers of Manitoba Association chairman, said the CRFA s argument against supply management also fails to account for government subsidies. The association compares Canadian milk prices to prices in countries where the industry is subsidized, he said.

In those countries, consumers end up paying for their milk twice, first at the grocery counter and again when they pay their taxes, said Wiens.

Wiens said the current dairy supply management system benefits both producers and consumers by keeping pricing stable and based on production costs. Other markets see milk prices fluctuate significantly.

For Jake Wiebe, chairman of the Manitoba Chicken Producers, it s clear specific groups are now pushing for changes to supply management, particularly from international trading partners, like those involved in CETA .

We have been assured by Minister Ritz and the Conservative government that supply management will not be included, he said. There is always risk. Governments try to negotiate and do their part, but we have been assured and I do believe them. They don t want this industry to cost them the way the hog industry has.

Wiebe, a former hog producer, said people have asked how the hog industry would have fared if managed by supply management.

But there is no clear answer, every industry is different and sometimes government programs are needed, he said.

The farmer added it s not as straightforward as educating the public on the costs of subsidies either.

It doesn t really work for us to play one industry off against another, said Wiebe.

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& they want to ensure there is an endless supply of raw materials at very low prices& and I can tell you this is going to come off the backs of our farmers.

IAN ROBSON

National Farmers Union

About the author

Reporter

Shannon VanRaes is a journalist and photojournalist at the Manitoba Co-operator. She also writes a weekly urban affairs column for Metro Winnipeg, and has previously reported for the Winnipeg Sun, Outwords Magazine and the Portage Daily Graphic.

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