OTTAWA – Attempts to negotiate a new long-term dairy policy have fallen behind schedule, in part because of growing animosity between industry players.
In its March budget, as compensation for announcing the end of the dairy subsidy, the government said it wanted a new long-term policy by Aug. 1.
Now, even an end-of-December target date looks too hopeful.
While Ottawa is encouraging industry agreement on a new policy, some major players are exchanging sharp barbs.
Kempton Matte, president of the National Dairy Council of Canada, the processor lobby group, says processors and farmers have conflicting goals and growing mistrust.
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“We want a long-term dairy policy that will provide a road map to the future,” he said. “The farmers want a policy that sets them up for compensation if the government cannot deliver what is promised. We refuse to buy into that.”
Matte said processors may not attend a scheduled meeting with Dairy Farmers of Canada at the end of August.
Agreements broken
“It’s possible we will cancel the meeting. When we have done deals in the past with farmers, they haven’t always respected those agreements.”
He cited as an example an agreement during the past year to limit price changes to one per year. Shortly after, “the ink was hardly dry” when the Canadian Milk Supply Management Committee recommended a milk price increase.
“These are the same people, the same farm representatives,” said Matte. “How can we trust them? I think they think the consumer will accept anything. I don’t.”
At Dairy Farmers of Canada, Rick Phillips said the processors should support development of a new long-term policy for the stability it would give.
“My sense is they would find a new policy that fixed the rules a good thing because it would give them some planning stability,” he said.
Phillips said the dairy farmer lobby wants a new policy that lasts until 2002 or the end of the present world trade agreement.
He said it should commit the government to honoring World Trade Organization commitments but go no further in reducing Canadian protection.
It should support maintenance of the “supply management infrastructure,” such as the Canadian Dairy Commission price-setting and marketing board rules.
“We also would be looking for a commitment that the loss of the subsidy continues to be passed on to the consumers through pricing,” said Phillips.
While conceding that processors and farmers have sometimes competing economic interests, he said Dairy Farmers of Canada expects processors to attend the planned August meeting and to work for a new long-term policy.
Meanwhile, Ontario Liberal MP Jerry Pickard, parliamentary secretary to the agriculture minister, is in charge of trying to bring the sides together.
He has scheduled meetings with all the players, including the Canadian Dairy Commission, for the next month. Pickard said last week it is not the government’s role to impose a new policy.
“What we’d like is some clear consensus from the industry,” he said. “It is important that we be good facilitators for that.”
Pickard said the timing of a new deal is less important than the fact that a strong policy emerge.
He said the timing has been hurt by the delay in receiving the final report of a trade disputes panel, which has been considering an American challenge of supply management protective tariffs. The latest date for public release of the report is the end of September.
Although Canada won in the preliminary judgment, the Americans are appealing to the panel to change its mind.
“It is crucial we have that report before we really can set a long-term direction,” he said.
