Canadian Dairy Commission

The Canadian federal government has been active in supporting the dairy industry since 1890, when the first Dominion Dairy Commissioner was appointed. In 1967 the government of Canada passed the Canadian Dairy Commission Act which established the Canadian Dairy Commission (CDC). The Canadian Milk Supply Management Committee, whose members include the CDC and representatives of provincial producer marketing boards, was set up in 1970 to administer the national Market Sharing Quota. In 1972, the Farm Products Agencies Act authorized the establishment of supply management, which can restrict production by use of quotas. ==Mandate, implementation, and administration==

The CDC's mandate is to "Provide efficient producers of milk and cream with the opportunity to obtain a fair return for their labour and investment" and to "Provide consumers of dairy products with a continuous and adequate supply of dairy products of high quality." The CDC aims to avoid depending on government subsidies and the dumping of surpluses into third markets. Milk support prices are changed typically once a year using a formula determined by the industry. The price adjustment formula is based on the cost of milk production, as determined by a randomized and anonymous survey of roughly 200 farms. The CDC promotes consumer awareness and programs to stimulate demand for Canadian dairy products. In collaboration with the private sector, the CDC monitors the seasonal domestic supply of milk to maintain a balance between supply and demand. ==Issues and debates==

Governance Sylvain Charlebois, professor of food distribution and policy and the director of the Agri-Food Analytics Lab at Dalhousie University, expressed concern that the CDC, "owned by all Canadians, is controlled by three people, all with dairy connections. Processors, retailers and, most importantly, consumers, are not represented." In 2023 and 2024, the CDC was urged to provide more transparency on the extent of "milk dumping," a method used by some Canadian producers to dispose of over-quota milk supply. Between 2012 and 2021, the Canadian dairy industry discarded on farms an estimated 7% of all milk produced (over 6.8 billion liters of raw milk, valued at $6.7 billion). Product quality Although Canadians pay high dairy prices, quality is not assured according to Dalhousie University professor Sylvain Charlebois. He pointed to Buttergate which revealed the practice of feeding cows with palmatite, an imported palm oil derivative, which affects butter's hardness. Milk price setting formula After a 8.4% milk price increase in 2022 – the largest since the CDC was created in 1967 – a C.D. Howe Institute commentary said not only are such large price rises undesirable for consumers, but they could be detrimental to the dairy industry if they lead to more illegal milk entering the market from the United States. The study said the CDC's price setting formula would benefit from having an external competent review. As a consequence, newspaper columnist Andrew Coyne says CDC policy was enacted "in the name of saving the family farm" but it has instead "led to its near extinction." The number of dairy farms in Canada in 2024 was approximately 9,000, compared to more than 145,000 when the CDC was established in the early 1970s. The consumer cost of dairy products The CDC limits the supply of milk entering the market, which keeps the price to consumers among the most expensive in the Western world. Milk farmers are required to participate in the supply management price-fixing system, an arrangement that would be illegal in almost any other sector of the Canadian economy (the Competition Bureau in 2018 brought a case against retailers for fixing the price of bread). Also, the high cost has a disproportionate impact on low-income Canadians, since a greater proportion of their incomes are spent on dairy products. ==References==