Agriculture and Agri-Food Canada

Agriculture and Agri-Food Canada

November 10, 2016 10:37 ET

Government of Canada Invests in Dairy Sector in Anticipation of CETA

OTTAWA, ONTARIO--(Marketwired - Nov. 10, 2016) - Today, as part of the Government's strong commitment to supply management, the Honourable Lawrence MacAulay, Minister of Agriculture and Agri-Food, and the Honourable Chrystia Freeland, Minister of International Trade, announced an investment of $350 million for two new programs to support the competitiveness of the dairy sector, in anticipation of the entry into force of the Canada-European Union Comprehensive Economic and Trade Agreement (CETA).

CETA will create more jobs and growth for Canadian families, will generate economic opportunities for the middle class, and will present substantial market opportunities for many segments of Canada's agricultural sector. The Government is supporting the continued strength of the dairy sector by helping to ensure that dairy producers and processors continue to innovate and improve productivity.

The two new programs are:

  • $250 million over five years for a Dairy Farm Investment Program that will provide targeted contributions to help Canadian dairy farmers update farm technologies and systems and improve productivity through upgrades to their equipment. This could include the adoption of robotic milkers, automated feeding systems, and herd management tools.
  • $100 million over four years for a Dairy Processing Investment Fund that will help dairy processors modernize their operations and, in turn, improve efficiency and productivity, as well as diversify their products to pursue new market opportunities.

These programs will complement the dairy sector's ongoing investment efforts, helping both current and future generations of dairy farmers and processors to remain profitable for the long term, within a strong supply management system.

During consultations, stakeholders shared their views on the anticipated impacts of CETA. These programs were informed by this feedback and by the Government's over-arching priorities to build competitiveness and innovation in our economic sectors.

In the coming weeks, the Government will engage with the dairy sector to seek input that will inform program design to help ensure programs respond to the needs of producers and processors. Input can also be provided online. Programs will be in place when CETA comes into force.

Quotes

"The Government strongly supports supply management. Canada's dairy producers and processors are vital to the prosperity and clean growth of our nation. They create jobs and offer high-quality products for Canadian consumers. These programs will help Canada's dairy sector become more productive in order to help it adapt to the anticipated impacts from CETA."

  • The Honourable Lawrence MacAulay, P.C., M.P., Minister of Agriculture and Agri-Food

"This is an opportunity for Canadian dairy producers and processors to modernize their operations and become more competitive in Canada and in international markets. I encourage producers to leverage the new market access provided by CETA and other free trade agreements in order to grow their business."

  • The Honourable Chrystia Freeland, P.C., M.P., Minister of International Trade

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BACKGROUNDER

The Canada-European Union Comprehensive Economic and Trade Agreement (CETA) will provide Canada access to the world's largest agriculture and agri-food market. Upon entry into force, the agreement will present substantial market opportunities for many segments of Canada's agricultural sector, such as pork, beef, maple syrup, horticulture and processed foods, to name a few.

CETA will also provide greater access for European cheeses to Canada, more specifically, duty-free imports of 17,700 tonnes of cheese, representing about four per cent of Canada's cheese production. While dairy producers and cheese processors will continue to see their income increase in future years, they are expected to see a loss in anticipated income growth as a result of this new access for European cheeses.

As such, the Government is supporting the continued strength of the dairy sector, and in turn the Canadian economy by providing opportunities for dairy producers and processors to innovate and boost productivity.

The two new programs announced today are intended to help the dairy sector adapt to new market opportunities and challenges. The precise terms and conditions of the programs will be finalized following discussion with industry.

  1. Dairy Farm Investment Program: will help dairy farmers in their efforts to further modernize their operations and improve productivity. The investments in new equipment are expected to complement the investment efforts deployed by our Canadian dairy farmers.

For example, the program could support activities such as the adoption of robotic milkers, automated feeding systems, herd management tools, or other equipment upgrades.

  1. Dairy Processing Investment Fund: is intended to support the dairy processing sector as it seeks to improve efficiencies and productivity to respond to the new market environment resulting from CETA. This initiative is separate from the government's commitment to the Agri-Food Value Added Investment Fund. This funding envelope is specific to the dairy processing sector, and is intended to support the dairy processing sector as it seeks to adjust to new market conditions created by CETA.

The program will help dairy processors by supporting access to technical expertise and the purchase of new equipment in order to expand processing capacity, enhance efficiencies and productivity, and diversify product lines to maintain and capture new market opportunities.

Contact Information

  • Guy Gallant
    Director of Communications
    The Office of the Honourable Lawrence MacAulay
    613-773-1059

    Media Relations
    Agriculture and Agri-Food Canada
    Ottawa, Ontario
    613-773-7972
    1-866-345-7972