Supply management a ‘sacred cow,’ but politicians want more competition

There aren’t many issues that garner support across party lines in Ottawa these days.

But when it comes to the supply management system for egg, poultry and dairy products — the mechanism that sets prices for producers — all of Canada’s federal parties seem to see eye-to-eye.

Political support for the controversial agricultural framework has endured, despite the country’s ongoing affordability crisis and critics who persistently warn that it’s Canadian consumers who pay the price.

As a result, Ryan Cardwell, an agricultural economics professor at the University of Manitoba, doesn’t put much stock in what elected officials have to say on the subject.

“On one hand, they talk about food affordability, and (on) the other hand, they have a government-sanctioned cartel in staple foods,” Cardwell said.

“So, it’s talk. I don’t give it much credence.”

Canada’s supply management system sets prices for products and puts controls on production and imports to protect domestic farmers from foreign competition, guard against price volatility for their products and stabilize production levels.

First introduced in the dairy industry in the 1960s before expanding into eggs and poultry, the system exists in lieu of subsidies, which are common in the agricultural sector around the world.

Proponents of supply management argue the system is a win-win for producers and consumers alike: it offers both stability and predictability in prices and production.

But economists are often critical of the system because they say it stifles competition. Economic theory suggests more competition generally leads to lower prices.

The sharp rise in food prices post-pandemic has led to more scrutiny of grocery giants and raised concerns about a lack of competition in