Compensation program – Les Producteurs de lait welcome the government’s announcement

Bruno Letendre, Chair of Les Producteurs de lait du Québec, welcomes the federal government’s announcement on the dairy producer compensation program following the Comprehensive Economic and Trade Agreement with the European Union (CETA) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). “This announcement is right in line with its commitment to compensate the dairy sector for the adverse effects caused by the trade agreements and is consistent with the latest budget’s directions. We hoped that there would be no concessions for us in these agreements, but concessions were made. So producers needed to be compensated,” declared Bruno Letendre, Chair of Les Producteurs de lait du Québec.

“Furthermore, the Canada-United States-Mexico Agreement (CUSMA) has not been ratified yet, but we expect the government to be just as attentive to our needs when it has ratified the agreement, just like it promised when the agreement in principle was concluded and the budget was established,” he added.

Remember that since the CETA was concluded in October 2013, milk producers have been used as a bargaining chip in two other trade agreements, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in January 2018 and the CUSMA in October of the same year. In total, Canada has conceded the equivalent of 8.4% of Canadian dairy production in these agreements. The concessions represent permanent lost sales in the gross amount of $450 million per year. These agreements have been in force since 2017 (CETA) and 2018 (CPTPP) and producers are already feeling the effects. “Regardless of the amounts announced, producers will still have to bear the brunt of the long-term effects of the concessions,” added Bruno Letendre.

“Despite the concessions, supply management is still intact. We gave on the trade negotiation front and the government needs to let us rebuild in a stable environment in the future. The Prime Minister promised that there would be no more concessions in our sector. We cannot let down our guard if we want to be sure that this promise is kept. Furthermore, due to the upcoming election, we are asking all parties to promise that they will maintain the program announced by the government, compensate producers when the CUSMA is ratified, and make no other concessions in the dairy sector during the next trade negotiations” explained Mr. Letendre.

Milk production and processing generate around 83,000 direct, indirect and induced jobs in Quebec and contribute as much as $6.2 billion to the gross domestic product. Ultimately, they generate $1.3 billion in tax receipts. In Canada, the dairy sector contributes $19.9 billion to the GDP, creates 221,000 jobs and provides $3.8 billion in tax receipts. In 2017 alone, Canadian milk producers invested $2.6 billion in their farms. “This announcement will help the dairy sector continue to make a major contribution to the Canadian economy, despite the losses resulting from the three agreements. Our dairy farms are not relocating abroad. In other words, the government’s assistance will be spent and reinvested in the Canadian economy,” concluded Mr. Letendre.


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