A guide to understanding the dairy dispute between the U.S. and Canada

The Globe and Mail ^

[bryan999]

Why are U.S. dairy farmers mad at Canada?

Canada has long maintained a high tariff wall on most dairy products. The duty on milk is 270 per cent. That keeps most imports from the United States and elsewhere out of Canada, while helping to prop up higher domestic prices. One notable exception is ultrafiltered milk and other protein-rich dairy ingredients used to make dairy products such as cheese and yogurt. North American free-trade rules do not cover these ingredients, so they enter Canada duty-free. And in recent years, U.S. dairies have developed a booming business selling these low-cost products to dairies in Canada ($133-million last year). That all changed about a year ago, when Canadian dairy farmers and producers moved to close the breach in the tariff wall with a new "ingredients strategy." They persuaded regulators to create a new lower-priced class of industrial milk as an incentive to get dairies to produce protein substances in Canada, using Canadian milk. The result was predictable: U.S. imports fell in 2016, and are declining sharply so far this year.

[ridesthemiles]

I shop at a Smith’s store in Dayton, NV, which is affiliated with Kroger. I can buy butter at the prices you are quoting, but have never seen milk at the prices you have. More like $2.80 at best. Even Wal-Mart has a price that hovers around $3.50.

[Paladin2]

"The Tariff of 1789 placed France and Great Britain on an equal footing with regard to shipping, manufactures, and raw products delivered to American ports. All foreign-owned or foreign-built ships paid 50¢ per ton duty; American-owned vessels were charged 6¢ per ton.[20]"

Sounds like a simple rate structure.

[familyop]

That’s true. Our foreign trading partners now use more complicated strategies to cause trade imbalances.

[be-baw]

“have never seen milk at the prices you have. “

I still find it hard to believe I can get milk for $1.19/gal. It is likely temporary. Since Kroger doesn’t advertise it, I presume it won’t last long.

[Sparticus]

I visited Vancouver, BC about a year ago. We stopped in a grocery store to buy snacks and I couldn’t believe how expensive milk and chicken were. Milk was almost twice as expensive (in US dollars) and chicken was as expensive as beef and pork. Viva la Regulation.

[packrat35]

Recently in MS, I bought a gallon of milk for $1.09 at Kroger. Couldn’t believe it was that low.