U.S. tariffs would have little effect on Canada’s ‘cartelized’ dairy industry, experts say
The notion that U.S. tariffs on Canadian dairy products could significantly alter Canada's protectionist dairy system seems far-fetched to many experts.
Ryan Cardwell, a professor at the University of Manitoba, explains that Canada’s supply management system, governing dairy, egg, and poultry production, is highly controlled and 'cartelized'. He argues that U.S. tariffs would unlikely disrupt the Canadian market as the U.S. imports minimal Canadian dairy products. In 2024, Canada exported $350 million worth to the U.S., while it imported about $880 million in American dairy.
The existing system, while frustrating for international partners, ensures controlled production and pricing, preventing market oversupply.
David Wiens of Dairy Farmers of Canada believes tariff-induced changes would threaten local farmers' livelihoods. Additionally, Trump’s administration previously sought greater market access during NAFTA renegotiations, resulting in Canada providing new tariff rate quotas under the CUSMA.
Pascal Thériault from McGill University fears future negotiations could further threaten Canada’s supply management. Yet, Leonard Polzin, a dairy economist, warns that retaliatory Canadian tariffs could harm U.S. farmers, noting that global buyers might seek alternative markets if trade disputes intensify.
