Canadian dairy farmers have been made sacrificial lambs

by Marlene Campbell

FF Dec. 18 Marlene Campbell Headshot.jpg

I have a powerful childhood memory from the 1960s of playing alone in the living room of our old farmhouse in the community of Southwest Lot 16, P.E.I., while my mother worked alone in the barn milking our dairy cows and doing the chores. I remember the anticipation of waiting for my father to come home from a faraway place called Montreal where, I would later learn, he participated in meetings to establish an efficient modernized system that would give him and every other dairy farmer in Canada a fair return on their labour and investment. That scenario of my father being away at meetings and my mother working alone played out numerous times in my childhood.

It makes me feel proud to state that my father played a role in the modernization of the Island dairy industry and in the development of the supply management system for the Canadian dairy industry. The system lifted Canadian milk producers from the quagmire that U.S. farmers currently find themselves in. American farmers experience milk prices below the cost of production, overproduction, and the loss of farms, investments, and livelihoods, as well as dependency on government subsidies – all consequences of the “free market.”

What I know is this: supply management never made my father a privileged, spoiled, rich, protected farmer who gouged the Canadian consumer, which is the representation so many neo-liberal economists, politicians, think tanks, and media have put forth. He was a hard worker who wanted a fair income and was willing to advocate for equitable conditions for others in the industry.

Supply management – defined as the control of supply to meet demand – has been a fair and worthy system for the dairy industry. At its best, it gave our family and every other dairy family the security of a known income. That, in turn, allowed the cost of production to be covered, a workable return on investment, and a small return on labour – if the business was run efficiently. Supply management gave the farmer the ability to determine the level of risk he or she was willing to assume in expanding the business. It did not give protection from inefficient and poor business management, as so many critics of the system like to preach.

For Canadian consumers, supply management has provided a transparent transaction in which they pay only for what they actually consume and have the assurance of a highly regulated, safe product on their tables. No Canadian who pours milk on his or her breakfast cereal paid for it at the store and then again in taxes as do Americans.

Beyond the direct benefits to the producer and the consumer, supply management has given Canadians much more. Dairy farmers are not an isolated entity. They are part of the economic and social interconnectedness of all Canadians – rural and urban. There are plenty of people who will never step foot on a dairy farm, but they are impacted by its existence. In the production of milk, dairy farmers purchase a wide variety of goods and services. Purchases include livestock, land, seed, fertilizer, sprays, machinery, vehicles, fuel, milking equipment, cleaners, breeding services, veterinary services, foot trimming services, processed feeds, accounting services, and financial services. They hire carpenters, plumbers, electricians, mechanics, and other tradespeople.

All the businesses selling to or serving farms are then investing in their own businesses by buying goods and services, and employing people. The salaries those people earn buy more items and in turn create more employment.

Dairy farmers directly employ farm workers and underpin many other jobs related to the industry. A milk hauler pulls into the yard to collect the milk and transport it to a dairy for processing in its many forms. That dairy hires people for all stages and forms of processing, as well as for accounting, packaging, marketing, and transporting products to market. Then there is the retail sector. All those workers buy vehicles, homes, and consumer goods, and pay taxes that build social programs, generating further expansion in the economy as money flows throughout.

The list goes on, but I think the point has been made. The managed dairy industry has been very valuable in its contribution to the overall Canadian economy and in particular to the health and stability of rural Canada. But that reality is fading fast. The market share numbers given away in the first two free trade deals and in the impending one might not sound like much. But with a small population, Canada’s domestic market is miniscule compared to that of our neighbour to the south.

Dairy farmers have been silently hurting for some time now with the ongoing undermining of the supply management system. An example is that dairy imports have allowed processors to create new classes of milk, forcing prices down. Our family’s Amalgamated Dairies Ltd. (ADL) statements from 1987 show that dairy farmers were receiving 78 cents per litre at that time. Today, the average price is 62 cents per litre while input costs keep climbing. Dairy farmers struggle to meet production costs as inputs continue to rise. Businesses serving those dairy farmers are also starting to feel the pinch. I think the average Canadian wage earner can relate to this scenario.

Even before the federal government’s latest concession to the United States, many dairy farmers were already debating how long they could stay in business. The size of a farm doesn’t matter – all farmers are faced with depressed prices, increasing production costs, growing debt, and falling equity. If nothing changes and the deal is ratified, it will not take long until many are forced out of business. The Canadian consumer will likely find that even if they do get a cheaper product in the dairy aisle, the overall cost to the local economy and infrastructure will far outweigh any short-term savings.

Canadian dairy farmers have been made the sacrificial lambs in the recent trade negotiations. They took the hit for all Canadians and our economy. So are Canadians now willing to step up and make it right by supporting those farmers? By doing so, they will be supporting their own interests.

The federal government has done a grave injustice to Canadian dairy farmers by giving away in three trade deals an ever-increasing percentage of their domestic market in favour of supporting other industries.

The market has no concern for the welfare of individuals, communities, or borders. The study of recent history is showing that the economics and politics of “letting the market decide” means there are very few winners as the division of wealth is rapidly growing and more and more people are getting left behind. Our government needs to protect the supply management system, which has served our economy so well. There is more at stake than a few spoiled, protected farmers.

President Donald Trump did nothing long-term to help his unorganized free-market farmers, who already had more access to the Canadian market than Canadian farmers had to the American market. He just spread the pain and further concentrated wealth.

Canadian dairy farmers need to be vocal about what they have contributed to the Canadian economy and to the sovereignty of our food supply. Canadian farmers are proud business people who prefer to earn their paycheque over receiving subsidies. But now is the time for them to make public the economic insecurity they are facing and the disillusionment and anguish stemming from working sun-up to sundown only to have control of one’s business torn away at a negotiating table by people so far removed from the farmer’s reality.

Canadian consumers need to listen and learn and stand behind their farmers. The supply management system – rightly fought for by farmers like my father – has great merit and deserves to be honoured and respected.

Canadian politicians need to pay attention to the reality of the situation and correct the wrong they carried out. Prime Minister Justin Trudeau needs to stand up and say that it wasn’t a great deal for Canadian dairy farmers and that he will take the necessary steps to ensure the survival of an industry that was efficiently working until it became a pawn in government trade deals.

My father started with nothing and often worked numerous jobs to build an honest, efficient business. He was on his way to a dairy meeting in the fall of 1983 when his life was taken by an impaired driver. His work is carried on by his son and grandson for whom each day in the business has become a mental, physical, and financial struggle of uncertain survival no matter how long, hard, or efficient they operate. They are not alone. It is a far cry from living the life of the “privileged, protected farmer.”

(Marlene Campbell lives in Arlington, P.E.I.)