Pizza will get cheaper in Canada. Well, maybe …
For the first time in 22 years, the Canadian Dairy Commission has decided to reduce the price of milk at farmgate by 1 per cent. Price reductions started at the beginning of the month. Under its supply management regime, established in 1966, the commission’s mandate has been to set the price of milk per hectolitre for dairy farmers owning production quotas. The new decision to reduce prices, according to commissioners, is to stimulate domestic demand for milk per capita which has been decreasing for decades in Canada. As surprising as this decision may be, such a move from the commission is evidence that the dairy sector is fully aware of systemic pressures on supply management.
Big changes are coming. If ratified, the Comprehensive European Trade Agreement would allow over 17,000 tons of cheese into our country. Currently in Europe, milk is cheap and getting cheaper. In April, Europe ends its quota system, and many producers have started to flood the market with much more milk. There is an abundance of supply which has depressed milk prices at farmgate and retail. Prices have gone down by more than 40 per cent in some regions which makes European cheese more competitive against our own. In addition to having concealed subsidies, European cheeses have a significant competitive advantage.
To read the rest of the story, please go to: Montreal Gazette