As part of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Canada agreed to provide 10 Trans-Pacific countries with an additional 3.25% of access to its domestic dairy market. This access comprises a wide-range of dairy categories ranging from fluid milk to cheese to yogurt.
How will this impact dairy processors?
DPAC estimates that, over the course of the agreement’s implementation, CPTPP market access will result in more than $700 million in losses for Canada’s dairy processors. According to Global Affairs Canada’s own estimates, dairy imports associated with CPTPP will increase by 13% while exports will increase by a mere 0.5%. This federal government forecast confirms that CPTPP will not benefit Canada’s dairy sector.
Dairy processors have invested over $7.5 billion in capital investments and research and development to strengthen and grow Canada’s domestic dairy market over the last decade. However, in just the past two years, the access that Canada has granted access to trading partners through CPTPP, CETA, and now the United States-Mexico-Canada Agreement (USMCA, formerly NAFTA) represents a combined loss in return of investments of more than $2 billion to dairy processors. Theses losses do not reflect the additional concessions made with regard to domestic dairy policies in USMCA, which promise to be equally or even more harmful.
These market access commitments made by the federal government will negatively impact dairy production here at home and will make it difficult for the industry to see a reasonable return on past investments.
What is DPAC doing?
DPAC is meeting with government officials, Ministers and local Members of Parliament, and will be participating in the Government of Canada’s dairy sector working groups, to stress the importance of allocating CPTPP dairy import licenses, known as tariff-rate quota (TRQ) to dairy processors. This will allow not only the dairy processing industry to recoup a return on past investments, it will also encourage future investments in the Canadian dairy sector—its farms, processing plants, and people.
How can dairy processors help?
Contact the Minister of International Trade Diversification, Jim Carr, and your local Member of Parliament to tell them how CPTPP will impact your business and employees, and demand compensation for the dairy sector. To help you get started, we’ve provided a few key points in this template.
Want to know more about CPTPP and its impact on dairy?
As government makes a decision on CPTPP compensation, it needs to remember that Canadian dairy families are worth fighting for.
Dairy processing industry by the numbers:
- $670 million expected in lost return on investments resulting from CETA
- $730 million expected in lost return on investments resulting from CPTPP
- Hundreds of millions more are expected in lost return on investments resulting from USMCA
- $7.5 billion in investments made since 2008
- $18 billion contributed annually to the Canadian GDP
- 16 percent growth in dairy processing real GDP since 2008
- 12,000 Canadian dairy farms supported by dairy processors
- 24,500 Canadians employed by dairy processors
- Aggregate annual payroll of $1.2 billion