The Dairy Companies Association of New Zealand (DCANZ) has joined forces with US and Australian dairy industry representatives in calling for urgent government intervention to address the impact of Canada’s dairy export practices on global protein markets.
In a joint letter sent on January 8 to the trade and agriculture ministers of New Zealand, the United States, and Australia, the industry bodies expressed their shared concern that artificially low-priced Canadian dairy protein exports are undercutting fair market competition. The letter calls for “collective and coordinated action” to tackle the mechanisms Canada is using to enable the dumping of these exports on global markets.
At the heart of the issue is Canada’s milk pricing system, which is structured to undervalue surplus milk protein generated by its domestic supply management system, effectively subsidising its disposal in international markets. This setup allows Canadian dairy processors to access milk proteins at prices below the cost of production, distorting the export market for a range of dairy products.
“Canada’s policy approach is at odds with its international trade obligations in much the same way as previous Canadian dairy pricing policies were found to breach WTO export subsidy rules in the past,” says DCANZ Executive Director Kimberly Crewther.
The industry groups are urging the governments of New Zealand, the US, and Australia to take decisive action using all available trade enforcement tools. Both New Zealand and Australia are signatories, along with Canada, to the Multi-Party Interim Appeal Arbitration Arrangement, which upholds WTO trade rules. Meanwhile, for the US, the upcoming review of the USMCA (United States-Mexico-Canada Agreement) presents an opportunity to challenge Canada’s practices.
The letter underscores the urgency of the situation, warning that further Canadian processing investment could be based on continued access to below-cost milk protein. For New Zealand dairy exporters, this issue adds to an ongoing legal dispute regarding Canada’s restrictive allocation of Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) dairy quotas.
“It is an ongoing battle to ensure Canada upholds its trade commitments on dairy,” Crewther adds.
“DCANZ is pleased to be working with industry organisations from other dairy-exporting nations who share the objective of holding Canada to account for its dairy trade commitments.”
With global dairy trade already facing pressures from economic uncertainty and shifting consumer demand, industry leaders stress that addressing Canada’s policies is essential to maintaining a level playing field for legitimate dairy exporters.
