Canadian officials should recognize that existing regulations limiting farmer marketing options undermine the ability of the food sector to evolve, says a draft policy prepared by the Guelph-based George Morris Centre.
It says the existing Canadian Wheat Board monopoly is part of the problem. It also supports proposals at World Trade Organization talks to sharply reduce tariff protections for supply managed marketing boards.
The draft said existing marketing regulations in supply managed sectors and the prairie grains industry are the subject of growing tensions and challenges.
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“Increasingly, there is evidence that Canadian marketing regulations stifle innovation,” says the report.
While the rules were designed to deal with commodities and to give all farmers equal access to the market, they can be a problem for producers who want to provide the market with differentiated products, said the analysis.
It argues that “the new definition of marketing equity is that everyone has an equal opportunity to be different and that means some people continue to want to produce a commodity, often with the services provided by a producer marketing agency.”
Others want more options.
It suggests prairie hog boards have provided a possible model solution in their transition from mandatory to voluntary.
“One solution, which seems to have been successful for prairie hog producers, is to make the marketing boards voluntary, the concept of dual marketing,” said the draft proposal. “With dual marketing, those who do not want the services of a marketing board opt out. Those who do, stay in and follow the established rules.”
Although the analysis and problem examples cited appear to apply to both the CWB and supply management, George Morris Centre chief executive officer Larry Martin said Aug. 25 the voluntary recommendation is meant to apply only to the wheat board and even that suggestion will be modified in the final policy proposal to be published in the autumn, reflecting focus group feedback.
Musings about ending marketing monopolies do not apply to supply management boards, said Martin.
“To do so would mean the end of supply management and that is not the intent.”
Still, the paper does argue that at WTO talks, Canada should be willing to accept a reduction in over-quota tariffs for supply management in return for a deal that would give exporters more access to foreign markets. It is a position strongly opposed by supply management leaders.
The paper noted that tariff-reducing proposals at now-stalled WTO talks still would leave dairy, poultry and egg sectors with tariff protection of between 75 and 125 percent after a phase-in period.
