Canada’s supply-managed dairy sector is facing renewed debate over trade liberalisation, with economist Aidan Wakely-Mulroney arguing that Ottawa should open the sector further to international competition as part of a broader strategy to diversify the country’s trade relationships.
Writing in the Financial Post, Wakely-Mulroney argues that Canada should begin by liberalising dairy trade with the European Union, followed by the United Kingdom and countries covered by the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), including Japan, Australia and New Zealand.
The author further proposes that, by 2029, Canada could consider offering tariff-free access to U.S. dairy, egg and poultry products as part of a future bilateral trade agreement with Washington.
Canada’s dairy sector operates under a supply-management system involving production quotas and administered pricing. Wakely-Mulroney argues that these policies contribute to higher domestic prices and limited consumer choice, citing a Montreal Economic Institute estimate that the system costs Canadian consumers about C$244 per year.
The article also links dairy policy to Canada's wider trade negotiations. According to Wakely-Mulroney, supply-managed sectors have complicated negotiations with the European Union, the United Kingdom and the United States because Canada has sought protection for these industries while negotiating broader market access.
The author points to Australia and New Zealand as examples of countries that liberalised their dairy sectors. Australia undertook dairy-sector liberalisation between 2000 and 2009, while New Zealand's reforms took place between 1985 and 2003.
However, the proposed transition would also create adjustment pressures. The article acknowledges that greater import competition could negatively affect some Canadian dairy farmers, while arguing that other producers could potentially expand by accessing larger international markets.
The debate therefore extends beyond milk prices. It raises broader questions about how Canada balances farmer protection, consumer prices, domestic production, market access and international trade diversification.
Source: Dairynews7x7 1 Oct, 2026 Read full article here
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