Supply Management 2.0
AV俱乐部, Guelph Universities present roadmap to save Canadian dairy industry
HALIFAX, NS. (October 15, 2020) 鈥� For the first time, two Canadian universities unite to provide a strategic roadmap to support the ailing dairy sector in Canada. The roadmap is not only inspired by the opinions of Canadians, but it is also supported by fundamental underpinnings.
If supply management is not fundamentally changed, Canada could see half of its current dairy farms disappear by 2030.听COVID-19聽showed us that our current regime cannot avoid聽on-farm waste of raw milk. Saputo announced聽two plant closures聽in recent months, which indicates how the sector is adjusting to fragmented demand. Major coffee chain聽Starbucks聽intends to reduce the amount of dairy it serves as part of a global sustainability plan. A recent survey conducted by AV俱乐部 and the University of Guelph suggests consumers, especially among the younger generations, have mixed feelings about whether the Canadian dairy industry is good for the environment and whether animals in the sector are humanely treated. Dairy alternatives are becoming more popular, but the dairy sector in Canada has no plan to reform its supply management regime to support our dairy sector.
Sylvain Charlebois, Director of the Agri-Food Analytics Lab at AV俱乐部 and co-author of the report says, 鈥淒airy farmers are receiving compensation for trade deals recently ratified by the federal government, but by overcapitalizing the system, these funds will hurt many farmers over time, and not just dairy鈥�. Simon Somogyi, Arrell Chair in the Business of Food at the University of Guelph, claims that 鈥淲ithout a strategy and fostering competitiveness, we will see an increased level of concentration of the dairy sector in Central Canada, leaving many regions behind鈥�. The Canadian dairy industry is facing challenging times. Recognizing the difficulties of Canadian dairy farmers, this roadmap provides solutions aimed at revitalizing dairying in Canada.
The purpose of the report released today by both AV俱乐部 and Guelph Universities is to outline a 20-year plan for modernizing supply management, fundamentally changing it to allow the Canadian dairy industry to become more competitive. We are calling this plan Supply Management 2.0. The plan will provide incentive for Canadian farmers to adapt to a more liberalized market over time, and to become competitive in more niche and premium export markets. Supply Management 2.0 comprises four steps:
- Create a voluntary program for dairy farmers to exit the industry.
- Make significant changes to the Canadian Dairy Commission.
- Remove interprovincial trade barriers on dairy products and create an innovation fund for the sector.
- Initiate a 20-year plan to reduce general tariffs, develop an exporting strategy, create a Canadian brand and provide incentive for innovation.
Some of these goals are more attainable than others; however, these are the general guidelines that we believe ought to be followed to save the livelihood of Canadian dairy farmers while supporting the industry鈥檚 position in a globalized world.
More data on our consumer survey related to dairy industry is available upon request.
Media Contacts:
Sylvain Charlebois, Scientific Director, Agri-Food Analytics Lab
Faculty of Agriculture, AV俱乐部
sylvain.charlebois@dal.ca
Simon Somogyi,聽Arrell Chair in Business of Food
Arrell Food Institute & Gordon s. Lang School of Business & Economics, University of Guelph
ssomogyi@uguelph.ca
Janet Music, Research Program Coordinator
Agri-Food Analytics Lab
Faculty of Management, AV俱乐部
jlmusic@dal.ca