A row of cows are hooked up to milking machines in the Armstrong Manor Farm milking parlour on Nov. 17, 2010. The recent study says the estimated 6.8 billion litres of milk thrown away could supply the needs of 4.1 million Canadians.The Globe and Mail
Take a litre carton of milk out of your fridge. Pour it down the drain. And then repeat – at least 6.8 billion times. That’s the volume of raw milk that Canadian dairy farmers dumped between 2012 and 2021, according to a recent study in the journal Ecological Economics.
The estimated 6.8 billion litres of milk thrown away, perhaps as much as 10 billion litres, equates to 7 per cent of annual production and would be worth $14.9-billion. The study says that amount of milk could supply the needs of 4.1 million Canadians.
Where does waste on that scale make any sense? Only in the topsy-turvy economics of supply management, the decades-old system that enriches farmers – increasingly large agricultural operations – at the expense of Canadian families.
Restricting supply is the entire point of dairy supply management, a stolid euphemism for what is in reality institutionalized manipulation of the market price for milk, butter and cheese. Throwing away huge amounts of perfectly good milk is just the obscene culmination of that manipulation.
The Canadian Dairy Commission argues that the study’s numbers – admittedly estimates but based on expert analysis of data such as herd sizes and lactation rates – are wrong. According to the commission, dumping is rare. “Based on verifiable data, of the approximately 9.6 billion litres of milk produced in Canada in 2023-2024, 99.9 per cent of butterfat and 99.1 per cent of solids non-fat in Canada were processed and marketed,” the commission’s executive director, Philippe Charlebois, wrote in an email.
Two thoughts spring to mind. The commission is citing data for a single year, the most recent, while the study looks at production trends from 2012 to 2021. Why the overly specific rebuttal? And if the dairy commission has data that track the dumping of milk (or the lack thereof), it should simply make that information public.
Indeed, transparency is a major theme for the study’s authors, including Dalhousie University professor Sylvain Charlebois (no relation to the CDC executive). They voice their support for the idea of agricultural supply management, if not the particulars of the current system.
Needed reforms in their view include a rethinking of the quota system, designed in an era before plant-based substitutes for milk were a mass market, and rewriting rules so that underproduction is no longer penalized more than overproduction. If supply management is to continue, such changes would lessen the cost burden for Canadian families.
But it would not eliminate that cost. As this space has argued before, the supply management system is inherently unfair, in effect a regressive sales tax on Canadian consumers. Poor families with milk-drinking children pay proportionately more than better-off Canadians.
And there is the other hidden cost of supply management, namely the concessions that Canada has to make (or the gains it cannot realize) in trade negotiations. Ottawa already placed supply management off limits in trade talks with Britain. A private members’ bill, currently making its way through the Senate, would make that a permanent policy.
If small farms need support, there is a better way, through tax dollars spent on subsidies. Independent-minded farmers might like to think otherwise, but supply management is already a government subsidy, just one whose costs are hidden.
Canada is likely headed into tough trade negotiations with the United States, whether Kamala Harris or Donald Trump wins the White House next month. A path to opening up Canadian agricultural markets to competition could be a key bargaining point in ensuring that the current trade agreement with the United States and Mexico is made permanent.
Small farms need not be cut adrift. There could be compensation for eliminated production quota, as there has been in the past. And supply management can be transitioned to a straightforward income-support program – one to which large agricultural corporations and other wealthy producers need not apply.
Such an approach would make clear to Canadians the cost of agricultural subsidies, a long overdue break from the current deliberate murkiness. And since those subsidies would come from general revenues, they would not disproportionately burden low-income families. Quite the reverse.
Trade gains, fairness for families and support for small farms: there’s a winning policy for any political party brave enough to challenge the gatekeepers of the dairy market.