Quebec Says Canada Should Rethink Dairy Policy

The largest dairy-producing province in Canada says the country should reconsider its dairy policy to help ease tensions with the United States.  The Premiere of Quebec said the perception is that the Class 7 milk-pricing policy was put in place to hurt the competitiveness of American dairy products.  Phillippe Couillard told Bloomberg that the pricing policy seems to be the main sticking point with the U.S., rather than the supply-management program that controls dairy output by matching production with demand through import tariffs and quotas.

The Class 7 milk policy began last year in Canada and makes it much cheaper for Canadian processors to buy domestic supplies of ultra-filtered milk, an important ingredient that boosts protein content in cheese and yogurt.  The policy has drawn the ire of U.S. President Trump, who says American farmers tell him that the policy all but blocks U.S. dairy exports from the Canadian market.

Couillard said it doesn’t seem that the supply management program is a U.S. target in the negotiations anymore. “If milk pricing is the main issue,” he says, “let’s see how we can approach that, separate from supply management.”

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