Welcome!

News Feed Item

Consumers — and farmers — would prosper from reformed dairy policy

Reform means ending price setting, opening export markets, and compensating farmers fairly for milk production quota

OTTAWA, March 6, 2014 /CNW/ - Consumers would enjoy a long-term reduction in dairy prices and the industry could be even more profitable than it is under the existing supply management system, under a reform proposal released today by The Conference Board of Canada.

The report, Reforming Dairy Supply Management: The Case for Growth, proposes a three-part reform in which Canadian consumers could eventually save an estimated $2.4 billion annually, and farmers could gain almost $2.5 billion from exporting high-quality dairy products to markets where demand is growing rapidly.

"A win-win reform package needs to be accompanied by a new vision for industry growth," said Michael Bloom, Vice-President, Industry and Business Strategy. "Dairy producers and rural communities have a lot to gain from reform under a growth scenario. More efficient producers are more likely to see an upside. But we have to change the way we do business."

HIGHLIGHTS
  • Supply management reform needs to co-ordinate three policies: liberalizing prices, unwinding milk production quota and reducing trade barriers.
  • A temporary consumer levy on dairy products could serve as transitional funding as the system is reformed.
  • Under reform of supply management, consumers would see lower prices over the long-term and Canadian producers would more than make up for lower domestic prices through export sales.

The report argues that the transition to a new system must address issues of funding, efficiency, equity, and duration (FEED) in a comprehensive manner.

"Supply management reform must coordinate the three major aspects of supply management: price setting, quota, and trade barriers. Cutting out any single part of the reform makes the entire system unstable," said Bloom.

Production quota reform
Production quota is, in effect, a licence to produce milk, which serves to limit the supply. Quota has become a valuable asset in the dairy industry, with large sums of money tied up in its purchase and sale. Any policy change must address quota reform; the Conference Board recommendations that it be done through a book value buyout-(the price paid for the quota at purchase). Such a reform would cost an estimated $3.6 billion to $4.7 billion, according to the report.

This approach is particularly important for farmers who have recently bought quota and therefore not yet realized the full value of the quota, which takes about 10 to 15 years. A market value buyout is unfair because it would compensate farmers for quota where they have already realized a return, effectively paying them twice for the same quota.

Price reform
The buyout cost could be funded through a consumer levy on dairy products, as was done in Australia. In the short-term, Canadian consumers are unlikely to see a significant change in dairy prices from current levels, which the Organisation for Economic Co-operation and Development has estimated costs about $2.6 billion more than prevailing world prices, or $276 per family. Within about five years, prices would likely settle at about the world average and consumers would see this amount returned to them in lower prices.

Trade reform
While price and quota reforms are taking place, trade policy negotiators need to gain access to international markets for Canadian dairy products. The worse-case scenario is one in which the domestic market opens to dairy imports before Canadian farms are ready to compete by scaling up production.

This report is one of 20 being produced by the Centre for Food in Canada. Since 2010, the Centre has been engaging stakeholders from business, government, academia, associations, and communities in creating a Canadian Food Strategy —one that will meet the country's need for a coordinated, long-term strategy on industry prosperity, healthy and safe food, household food security, and environmental sustainability.

The strategy will be launched at the 3rd Canadian Food Summit 2014: From Strategy to Action, March 18-19 at the Metro Toronto Convention Centre.

SOURCE Conference Board of Canada

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
With the rise of DevOps, containers are at the brink of becoming a pervasive technology in Enterprise IT to accelerate application delivery for the business. When it comes to adopting containers in the enterprise, security is the highest adoption barrier. Is your organization ready to address the security risks with containers for your DevOps environment? In his session at @DevOpsSummit at 21st Cloud Expo, Chris Van Tuin, Chief Technologist, NA West at Red Hat, will discuss: The top security r...
There is huge complexity in implementing a successful digital business that requires efficient on-premise and cloud back-end infrastructure, IT and Internet of Things (IoT) data, analytics, Machine Learning, Artificial Intelligence (AI) and Digital Applications. In the data center alone, there are physical and virtual infrastructures, multiple operating systems, multiple applications and new and emerging business and technological paradigms such as cloud computing and XaaS. And then there are pe...
SYS-CON Events announced today that B2Cloud will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. B2Cloud specializes in IoT devices for preventive and predictive maintenance in any kind of equipment retrieving data like Energy consumption, working time, temperature, humidity, pressure, etc.
DevOps at Cloud Expo – being held October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA – announces that its Call for Papers is open. Born out of proven success in agile development, cloud computing, and process automation, DevOps is a macro trend you cannot afford to miss. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the world's largest enterprises – and delivering real r...
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend 21st Cloud Expo October 31 - November 2, 2017, at the Santa Clara Convention Center, CA, and June 12-14, 2018, at the Javits Center in New York City, NY, and learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
Your clients expect transactions to never fail, cloud access to be fast and always on, and their data to be protected - no exceptions. Hear about how Secure Service Container (SSC), an IBM-exclusive open technology, enables secure building and hosting of next-generation applications, both cloud and on-premises. SSC protects the full stack from external and insider threats, allows automatic encryption of data in-flight and at-rest, and is tamper-resistant during installation and runtime – with no...
SYS-CON Events announced today that Massive Networks, that helps your business operate seamlessly with fast, reliable, and secure internet and network solutions, has been named "Exhibitor" of SYS-CON's 21st International Cloud Expo ®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. As a premier telecommunications provider, Massive Networks is headquartered out of Louisville, Colorado. With years of experience under their belt, their team of...
SYS-CON Events announced today that Suzuki Inc. will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Suzuki Inc. is a semiconductor-related business, including sales of consuming parts, parts repair, and maintenance for semiconductor manufacturing machines, etc. It is also a health care business providing experimental research for...
The “Digital Era” is forcing us to engage with new methods to build, operate and maintain applications. This transformation also implies an evolution to more and more intelligent applications to better engage with the customers, while creating significant market differentiators. In both cases, the cloud has become a key enabler to embrace this digital revolution. So, moving to the cloud is no longer the question; the new questions are HOW and WHEN. To make this equation even more complex, most ...
SYS-CON Events announced today that Fusic will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Fusic Co. provides mocks as virtual IoT devices. You can customize mocks, and get any amount of data at any time in your test. For more information, visit https://fusic.co.jp/english/.
SYS-CON Events announced today that Ryobi Systems will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Ryobi Systems Co., Ltd., as an information service company, specialized in business support for local governments and medical industry. We are challenging to achive the precision farming with AI. For more information, visit http:...
SYS-CON Events announced today that Keisoku Research Consultant Co. will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Keisoku Research Consultant, Co. offers research and consulting in a wide range of civil engineering-related fields from information construction to preservation of cultural properties. For more information, vi...
The last two years has seen discussions about cloud computing evolve from the public / private / hybrid split to the reality that most enterprises will be creating a complex, multi-cloud strategy. Companies are wary of committing all of their resources to a single cloud, and instead are choosing to spread the risk – and the benefits – of cloud computing across multiple providers and internal infrastructures, as they follow their business needs. Will this approach be successful? How large is the ...
Kubernetes is an open source system for automating deployment, scaling, and management of containerized applications. Kubernetes was originally built by Google, leveraging years of experience with managing container workloads, and is now a Cloud Native Compute Foundation (CNCF) project. Kubernetes has been widely adopted by the community, supported on all major public and private cloud providers, and is gaining rapid adoption in enterprises. However, Kubernetes may seem intimidating and complex ...
SYS-CON Events announced today that N3N will exhibit at SYS-CON's @ThingsExpo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. N3N’s solutions increase the effectiveness of operations and control centers, increase the value of IoT investments, and facilitate real-time operational decision making. N3N enables operations teams with a four dimensional digital “big board” that consolidates real-time live video feeds alongside IoT sensor data a...