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22 minutes ago
What the U.S. dairy industry really wants from Canada
U.S. dairy producers insist they're not looking for Canada to dismantle its supply management system, but they do want Canada to follow the letter and spirit of the existing deal that governs the dairy trade between the two countries. U.S. President Donald Trump has repeatedly blasted Canada as unfair and ripping us off with massive dairy tariffs, in a way that isn't fully accurate. However, senior figures in the U.S. dairy industry are concerned there's also some misrepresentation happening north of the border, creating a false perception of what U.S. producers are actually seeking in terms of access to the Canadian market. Shawna Morris, executive vice-president for trade policy and global affairs with the National Milk Producers Federation and the U.S. Dairy Export Council, says it's not true that her industry wants Canada to abandon its system for protecting the dairy sector. We've never been out to eliminate Canada's supply management, said Morris in an interview from her office in Arlington, Va., just outside Washington. It's much easier to create a boogeyman and fear-mongering around that being the goal of the Americans, but that's certainly not what our industry has advocated. Enlarge image (new window) Donald Trump dances as he departs a September 2024 campaign event at Central Wisconsin Airport in Mosinee, Wis. The top dairy-producing state in the U.S. has also been a key swing state in recent presidential elections, decided by less than one percentage point in each election since 2016. Photo: Associated Press / Alex Brandon Becky Rasdall Vargas, senior vice-president of trade and workforce policy at the International Dairy Foods Association lobby group, says she recognizes the Trump administration has been fairly abrasive in its tone toward Canada. But at the same time, I think we feel pretty ignored by Canada in terms of our legitimate trade concerns. Two main trade irritants According to Morris and Rasdall Vargas, the U.S. industry has two main irritants with Canada: how the Canadian government allocates the existing quotas for tariff-free imports of dairy products, and how Canadian milk producers dump cheap milk protein into the international market. The import quotas negotiated under the Canada-U.S.-Mexico Agreement (CUSMA, which Americans call USMCA) are designed to give U.S. producers tariff-free access worth roughly 3.5 per cent of Canada's domestic demand for dairy products. Three per cent is pretty limited, said Morris. It's certainly not a situation where our industry is gonna come in and take over the Canadian dairy market. How much U.S. milk comes into Canada? See interactive chart here (new window) CUSMA sets import quotas for 14 categories of dairy products. That allows an annual volume of each category (new window) to enter Canada tariff-free, and any imports exceeding the quota would get hit with sky-high tariffs of 200 per cent or more. Canada's rationale for this is ensuring the domestic dairy industry thrives by effectively capping how much the U.S. can export each year, preventing cheaper American products from dominating the market. The U.S. government supports its dairy sector with hefty direct subsidies (new window) . The U.S. dairy industry says it's not asking for Canada's quotas to be increased or the tariff rates to be decreased. Rather, it wants changes to how Ottawa allocates the quotas: more specifically, who gets them. Big Canadian dairies dominate import quotas Much of the quota volume is allocated to major Canadian-owned dairy processing companies such as Saputo (new window) and Agropur (new window) . Industry analysts on both sides of the border say such companies have little incentive to import U.S. products that would compete with their own. According to the U.S. producers, this restricts their access to the Canadian market. Their evidence for that claim: Canadian trade statistics (new window) showing tariff-free imports from the U.S. have almost never reached the quota limits in any category. WATCH | What Donald Trump gets wrong (and right) about Canada's dairy tariffs: For five years, Canada's been playing games with these tariff rate quotas, said Morris. That's a lot of volume that should have been able to reach Canadian consumers. Despite those complaints, Canada's imports of U.S. dairy products have risen significantly since the CUSMA quotas took effect in 2020. Those imports totalled $897 million in 2024, according to Statistics Canada data (new window) , more than four times the value of imports in any year before 2020. Trade certainly should be far higher than it is, said Morris. That was what USMCA promised to deliver and quite frankly has fallen far short. A key change the U.S. producers would like to see is for Canada to grant retailers and the food-service sector a share of the tariff-free quotas, allowing them to import some U.S. dairy products directly. The U.S. industry also wants Canada to be far stricter in taking away allocations from importers that fail to use their full quota in a given year. While a bill that Parliament passed in June (new window) bars Ottawa from agreeing to raise the dairy import quotas or lower the tariffs, it doesn't prevent other changes to the system, leaving Canadian trade negotiators some wiggle room. WATCH | Canada's supply management system, explained: 'An inherent mismatch' The other chief complaint from the U.S. focuses on Canada's cheap exports of milk proteins, also described as milk solids, such as skim milk powder. The Americans argue that because Canada's supply management system keeps domestic prices artificially high, Canada can sell its excess production of milk proteins internationally at artificially low prices, undercutting the competition. It frankly makes no sense that you could have one of the highest milk prices in the world and yet be exporting dairy protein at some of the lowest prices globally, said Morris. That's just an inherent mismatch. Canada's pricing of milk solids for the export market is currently the subject of a U.S. International Trade Commission investigation, ordered by (new window) the Trump administration, with a hearing scheduled for Monday (new window) . Dairy Farmers of Canada declined a request for comment on the case. During the recent election, all major parties expressed support for supply management and stated that it would be off the table in upcoming trade negotiations, the organization said in a news release (new window) in June. The Trump administration is not the first to accuse Canada of breaching CUSMA terms on dairy. Enlarge image (new window) Cows wait to be milked at a dairy farm in Granby, Que., on Feb. 5. Photo: The Canadian Press / Christinne Muschi Joe Biden's administration twice took legal action over Canada's handling of the dairy quotas, claiming it was unfairly undermining (new window) U.S. access to the Canadian market. The U.S. won the first dispute (new window) , which it launched in 2021, but failed (new window) to win the second, in 2023. Now in 2025, Rasdall Vargas says her industry wants Canada to be willing to hear its true concerns and do something about them. Ultimately, when we have a trading partner who isn't taking our concerns seriously until they're threatened to do so, it's also not a good feeling from our side, she said. Whatever anyone thinks about Trump's bluster on Canadian dairy, Rasdall Vargas believes it's having an impact. I think that's the president's way of having our back, probably more abrasively than Canada would like, she said. I will say I've never seen Canadian dairy interests take U.S. concerns about Canadian dairy policy more seriously than in the past six months. Mike Crawley (new window) · CBC News · Senior reporter Mike Crawley has covered Ontario politics for CBC News since 2009. He began his career as a newspaper reporter in B.C., spent six years as a freelance journalist in various parts of Africa, then joined the CBC in 2005. Mike was born and raised in Saint John, N.B. Follow Mike Crawley on Twitter (new window)
National Post
22 minutes ago
- National Post
Laryssa Waler: Stop the tariff tit for tat — let's build a Canada the world wants to bet on
Donald Trump's threat to impose sweeping tariffs on Canada landed with all the grace and subtlety of a toddler in full meltdown mode. He and his team are considering duties as high as 35 per cent on everything from lumber to autos. Predictably, Canada is preparing retaliatory measures. Article content We've seen this movie before, but as any parent knows, reasoning with a tantrum rarely works. With two sons and 13 years spent honing my skills in tantrum diplomacy, I've learned firsthand that yelling louder or digging in rarely helps. You win by stepping back, staying calm, and changing the game entirely. Article content Article content Article content Article content First: cut the cost of capital. Canada's combined federal-provincial corporate tax rate sits around 26.2 per cent — among the highest in the G7, and significantly above the OECD average of 23.9 per cent. And with falling corporate and personal tax rates in the U.S., we're lagging even further behind. If Canada does nothing, we risk losing investment to our neighbours south of the border for good. Article content Consider Ireland, home to just 5.5 million people, where a 12.5 per cent corporate tax rate attracted giants like Apple, Intel, and Pfizer. Far from gutting public services, this strategy created a 24 billion euros (C$38.5 billion) surplus in 2023 and gave Ireland the fiscal strength to establish a sovereign wealth fund. Similarly, Singapore's statutory corporate tax rate of 17 per cent often drops even lower thanks to smart exemptions and streamlined processes. Last year, Singapore, with a population of nearly six million people, attracted nearly $190 billion in foreign direct investment — almost double Canada's performance. Article content Of course, reducing taxes and regulations won't be painless. In the short term, this transition will mean challenges — especially for those industries that have come to rely on our overly regulated, taxpayer-subsidized, Ottawa-knows-best, economy. Instead, let's shift current subsidies toward retraining programs, job transition assistance, and targeted support to help workers adjust and thrive in a more competitive, forward-looking economy. Article content Tax reform alone isn't enough — we need to replace cumbersome red tape with red-carpet service. Investors don't just look at costs; they're closely watching timelines and value predictability. Right now, Canada is infamous for project delays. Ottawa needs to deliver on its promised 'one-door, one-year' approvals guarantee. If regulators can't reach a decision within 12 months, the default answer should become yes. Article content Let's also make livability our defining advantage. Corporations don't just invest in markets — they move their families. Canada used to be a natural winner here, but our shine has dulled. Carjackings in Toronto have more than doubled since 2019, violent crime rates are climbing, and housing costs have soared — starter homes in Toronto and Vancouver regularly exceed seven figures. Our education system often seems more focused on woke social justice initiatives than on mastering the basics, and our students' math and reading scores are slipping. The reality is, the highly skilled immigrants that accompany foreign direct investments are beginning to look elsewhere.
National Post
22 minutes ago
- National Post
Peter MacKinnon: Something has to give for universities that are fighting for their survival
In a recent article in Halifax CityNews, journalist Rachel Morgan asked an important question: can Nova Scotia universities survive the red line? Budget deficits, tuition controls and caps on international student numbers combine to threaten their stability and perhaps, in some cases, their existence. The issues are not for Nova Scotia alone; they are present in all provinces. Article content Article content Though we sometimes speak of universities in generic terms, there are sharp differences among them. Dalhousie University in Halifax is a medical-doctoral institution well known throughout the Atlantic region and across Canada. Other universities in the province vary in size and stature but have more of a local impact, and some are embedded in communities that are dependent upon them, e.g. Acadia in Wolfville, St. Francis Xavier in Antigonish, and Cape Breton University in Sydney. Ten universities are a lot in a province with a population approaching 1.1 million, but they are all established institutions with communities that are intent on their survival and success. Article content Article content The hurdles in their way are substantial. In Nova Scotia, as in other provinces, the percentage of budgets from government grants has been steadily declining but the decline has not been met by offsetting fee increases, and provincial governments continue to control tuition, prescribing levels that are insufficient to make up budget shortfalls. Where, historically, universities have been able to set their own tuition fees — for international students — the federal government has intervened to impose caps on their numbers. While the impact among universities varies depending on the extent of their reliance on students from other countries, it is felt by all. Article content Article content Clearly this situation is not sustainable; as the old saying goes, something has to give. Public support has to increase or universities must be given the latitude to make up through tuition the shortfalls between government grants and what they need to do their work well. Governments must recognize this choice and be guided by it. Article content Article content Universities, too, have choices to make. When the Council of Nova Scotia University Presidents meets, do they talk about collaboration, rationalizing programs, collective procurement, outreach to business and working in solidarity to achieve better collective bargaining outcomes? Or are they focused on the latest issue or crisis? (I would bet on the latter). They should ask themselves, too, about why the standing of our universities with the public has declined. Canadians are losing confidence in their political neutrality and in what should be their commitment to non-discrimination and freedom of expression. These are not conditions that lead people to press their governments to support more public funding. Article content But despite their shortcomings, our universities are vitally important in shaping the future of Canada. Their futures depend on broad non-partisan support for their missions and activities and, until that support is recovered, they are unlikely to fare better — in Nova Scotia or elsewhere in Canada. Article content
