Holstein Canada

Supply Management

Frequently Asked Questions (FAQ's) on Supply Management

3 Pillars of Supply Management

How does supply management work in the Canadian dairy industry?

Supply management in Canada ensures that total production responds to the Canadian demand for dairy products. Each farmer fills a part of the demand (quota) without producing more than what is needed in Canada. By balancing milk production from all Canadian farms with domestic consumption of milk products, Canada’s supply management system avoids surplus production preventing volatility in the supply and demand ratio that leaves farmers especially vulnerable. Stability allows efficient farms to remain in business in all regions of Canada. Over the years, Canada’s supply management model has provided a stable environment within which the dairy industry has been able to meet the challenges of changing domestic markets and international trade rules.
(Source: Your Milk)

When was supply management introduced in the Canadian dairy industry?

The Canadian dairy industry adopted the system of supply management in the early 1970s to address unstable prices, uncertain supplies and fluctuating producer and processor revenues, which were common in the 1950s and 1960s.In 1966, the Canadian Dairy Commission was created and, in the early 1970s, dairy became the first commodity in Canada to operate under a national supply management system.

What other commodities in Canada are supply managed?

Eggs, Chicken, Turkey, and Broiler Hatching.

Do dairy farmers receive subsidies from the government?

No. Dairy farmers across Canada do not receive subsidies from the Government because of the benefits of supply management. In Canada, consumers pay once for their milk, at the grocery till and not again through their taxes, as is the case in other countries around the world.

Who sets the price of milk at the grocery store?

The retail outlets-- not the producers or the dairy industry. On the glass of milk you order at a restaurant, your server will earn more from that glass than the dairy farmer who produced it will.
(Source: Alberta Milk)

Why is supply management beneficial to Canadian dairy farmers and Canadian consumers?

Over the past forty years, the supply management system has provided a stable environment within the dairy industry. Supply management helps keep viable, prosperous, and sustainable family farms operating in Canada. These farmers can in turn afford to have the highest quality and safest standards to ensure the dairy products they produce and consumers buy among the best in the world. Consumers in Canada can be proud knowing what they are consuming.
(Sources: Canadian Dairy Commission Dairy Farmers of Canada, Alberta Milk)