Canadian dairy farmers are telling reporters that they are
furious about the trade deal the federal government is poised to sign with the
European Union because it doubles tariff-free cheese imports to about 30,000
tonnes per year.
On the other hand, John Masswohl of the Canadian Cattlemen’s
Association says the deal will open the European market for about $600 million
worth of Canadian beef exports per year and Martin Rice of the Canadian Pork
Council says estimates a gain of $400 million a year for pork exporters.
And the federal government says the entire package will add
80,000 Canadian jobs producing $12 billion worth of goods that will be added to
exports to Europe.
Prime Minister Stephen Harper is flying to Europe to sign
the deal that still needs approval from the provinces and from 28 member
nations of the European Union.
The cheese concession was apparently the last item on the
negotiating table. Canada is also sacrificing another three years of patent
protection for pharmaceuticals.
At $1 billion per year for Lipitor alone, patent protection
will be costly for Canada’s health-care system.
Spokesmen for Canada’s dairy farmers said they fear European
cheese exporters will hit hard on the specialty-cheese markets that Canadian
processors have developed over the last 20 years.
Some say 30,000 tonnes from Europe would take a third of the Canadian specialty-cheeses market. They also complain that the Europeans are subsidized, they have been in business longer and they make superior cheeses.
The dairy farmers have been pursuing a policy of reducing
milk prices if and when Canadian processors face increased pressure from
imports, so Europeans will not necessarily be able to sell 30,000 tonnes per year to Canadians.
A milk-price break is, for example, what happened recently to persuade
pizza makers to stop importing “kits” from the U.S. because Canadian cheese
makers were given a price break on milk so they could re-capture orders from
the pizza companies.
There is no similar system of price breaks in the poultry
industry which is also beginning to experience increasing pressure from imports
finding a way around high tariff barriers.
Imports of fowl are a prime example, threatening to take a
huge chunk out of the market for Canadian-raised chicken.
So far there has been no mention of any changes in tariffs
for European companies seeking poultry-market sales in Canada.
