With the new European trade deal, there will be an additional 16,000 million tonnes of cheese quota available to Canadian importers.
Who will get this quota?
The existing quota is 13,000 tonnes, and those who hold permits from the federal government to import European cheese within this quota for tariff-free imports make a fortune.
They are able to buy European cheeses for quite low prices, often because the Europeans are trying to unload domestic surpluses into export markets in an effort to keep European prices up.
But Canadian consumers will not enjoy bargain prices.
Those who import European cheeses will sell for as much as the Canadian market will bear.
Keep in mind that 90 per cent of the Canadian cheese market is protected by a tariff of 246 per cent. A kilo of cheese arriving at our borders at a price of $5 per kilo would face a tariff of $12.30, bringing the cost up to $17.30.
Canadian cheese makers and wholesalers obviously price as close to that $17.30 per kilo as the market will bear.
And so that's how and why those who have the right (government permits) to import tariff-free cheese can and do make a fortune.
So, who will get permits to import the additional tariff-free cheese under this new trade agreement?
Will it go, pro rata, to those who already hold import permits? That's what I expect will happen.
Will they thank the Harper government with generous election-campaign donations?
I hope so. I'd hate to think we'll get absolutely nothing for this undeserved generosity.
