Canada Trade Minister Mary Ng said Tuesday the country’s system of tariffs and quotas aimed at protecting its dairy, egg and chicken producers – known as supply management – is off limits in future negotiations on trade pacts

“I have been clear that supply management will be protected and it won’t be a part of future trade negotiations,” Ng told reporters in Ottawa.

Canadian trade negotiators have generally worked to limit changes to the supply-management system, although in recent years they have eased the rules due to pressure from Washington and Europe. The timing of Ng’s remarks are noteworthy, with one of the opposition parties in the legislature warning it could work to topple the minority Liberal government as soon as late October unless Prime Minister Justin Trudeau offers enhanced protection to dairy, egg and chicken farmers.

 

 “Dairy trade was a central grievance during CUSMA talks and it could re-emerge when the trade pact comes under review in Washington”

 

 

Under supply management, government boards set the prices for dairy, egg and poultry products, and impose quotas on domestic producers to keep supplies in check. Canada also limits imports, and imposes steep tariffs when those limits are exceeded. Dairy trade was a central grievance during talks late in the last decade on a revised North American trade treaty – renegotiated at the behest of former president Donald Trump – and it could re-emerge as another obstacle when the trade pact comes under review in Washington.

The Bloc Quebecois, which holds the third-most seats in Canada’s legislature, said its future support of the minority Liberal government is conditional on Trudeau pushing through Bloc-supported measures, by Oct. 29, that protect the supply-management system and improve pension benefits.

The minority Liberal government is struggling in public-opinion polls, trailing the Conservative Party by as much as 20-percentage-points, and its former governing partner, the New Democratic Party, has pulled its support for the Liberals. Both the Bloc and NDP have to date rejected moves by the Tories to bring down the government, through no-confidence motions in the Canadian parliament, and trigger a snap election.