Why Supply Management in Canada can Co-exist with the Prospective Doha Round Result

The Canadian supply management system could continue to function under the prospective Doha Round result. The main change the industry would face would likely be the replacement of the present pricing system in dairy and eggs with a system of negotiated prices between producers and processors (paralleling the existing situation for chickens and turkeys) which still would reflect very substantial protection via the remaining over-quota tariffs. The main adjustment would be that Canadian producer prices would start to more closely track world prices which should be less volatile and higher as a result of the phase out of export subsidies and the creation of new market access opportunities.