The International Dairy Foods Association has harsh words for Canada’s supply-managed dairy industry and has called on the United States Trade Relations agency to fix it during trade negottiations.
Canada is the worst in the world, the association said.
It said the most severe and long-standing concern in the global dairy industry remains Canada’s deliberate actions to undermine dairy market access commitments.
It complained about Canada’s pre-emptive changing of milk price classes—specifically the implementation of a new scheme prior to the inew North American trade agreement to skirt the transparency requirements of Article 3.A.3.
Furthermore, Canada employs an ineffective dairy pricing formula with an outdated, artificially inflated processor margin from approximately 1972, which negatively impacts prices and results in a skewed relationship between product types, effectively disadvantaging U.S. milk protein exporters, the association said.
Canada is also accused of worsening the administration of tariff-rate quotas (TRQs).
It said that Canada’s tariff-rate quota policies are not transparent or fair, maintaining activity requirements that unduly favor domestic processors by double-counting their domestic manufacturing quantities toward allocated quota.
Furthermore, Canada explicitly prohibits retailers and foodservice operators from applying for the import quotas and frequently issues allocations as small as one kilogram to non-processor importers, forcing them to buy quota at higher rates from favored processors to conduct normal business, it said.
