Don't blame Canadian dairy farmers for U.S. struggles, says P.E.I. chair

The chair of the Dairy Farmers of Prince Edward Island says the struggles of American dairy farmers have nothing to do with Canada's supply management system.

In the wake of U.S. President Donald Trump's recent comments pointing the finger at Canada, Harold MacNevin said the problem lies south of the border with the free market system.

He said the free market system employed by the United States and other countries results in surplus milk, which means dairy farmers don't necessarily have their costs met.

"The processors in many instances are just telling the farmers, 'I'm sorry, we don't need your milk anymore,'" MacNevin said. 

'Look in his own backyard'

"That's a concern when [Trump] starts to put down and criticize the Canadian dairy industry when he just has to look in his own backyard to see what the reason is."

Canada's supply management system uses quotas, a price-setting formula and tariffs to ensure there is no surplus of milk, MacNevin said.

There are no tariffs on imports allowed through trade deals — which currently make up about 10 per cent of the domestic market — but tariffs apply to anything over and above that, MacNevin said.

"Those tariffs are a very essential part of the whole system."

Supply management 'working'

The supply management system provides a level of stability, MacNevin said.

"We get our costs back, as well as a guarantee that the processor's going to take our milk because we're not creating a surplus.

"It's a system that's working and the federal government recognizes the value of it."

As for Trump's comments, MacNevin said every world leader has the right to defend their national interests.

"He's doing just like any other leader in any other country. He's looking after and protecting his fellow Americans, and rightly so.

"Of course, some of the comments that he's making, we're concerned that sometimes they're not the entire truth. We didn't create the problem that the U.S. dairy farmers are having."

Watching NAFTA talks closely

Dairy farmers are keeping a wary eye on the ongoing renegotiation of the North America Free Trade Agreement, MacNevin said.

"If there's any loss of our market through that agreement, then we will certainly react to that and hold the government to task.

"You don't take your eye off the ball at any time during this process."

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