Welcome to the blog for Colgate University's interdisciplinary course on food. This is the place to keep up with what students in the course are experiencing in their work at Common Thread Community Farm and through their everyday encounters with food.

Sunday, October 6, 2013

Difference between Canadian and American dairy farming

http://www.agmrc.org/media/cms/staffpaper349_42EAB16A91E4F.pdf
http://www.iedm.org/1647-sour-milk-system-canadas-dairy-quota-system-of-supply-management-ensures-that-canadians-will-pay-more-and-inefficiencies-wi

These opinionated articles answered many of the questions I had about the systematic differences in these two countries' dairy industries. Firstly, Canada does participate in quota system, meaning that milk prices are managed by the government and thus it is a more restrictive system than in U.S. in which the market affects the prices of milk. In Canada, there are two milk markets--the fluid and industrial markets. The fluid milk market prices are controlled by Canadian provinces and the Canadian federal government controls the prices of the industrial milk. The government sets a target price for milk every year; these milk prices are determined formulaically based on costs of production, floor prices for butter/skim milk powder etc. and these prices a guided by the price dictated by the government. Canada has also taken on a supply management system so that there is a good balance between supply and demand for milk in both markets. The marketing of milk is also government controlled which aids in keeping the supply/demand in balance. This system also creates custom tariffs which ensure that foreign imports are kept to a minimum.

Canada also produces a lot less milk than the United States (16.8 billion pounds versus 167.6 billion pounds respectively); but when one accounts for population size, it is roughly equal. Farmers in Canada that wish to expand their dairy farms are usually not allowed to do because that would interfere with the supply management system and this is upsetting to many efficient farmers. That's basically the gist of the difference, and I can't go into much more detail because economics is not my specialty...

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