CUSMA compensation announced

The federal government is providing $1.7 billion in compensation to supply-managed sectors for market access granted under the Canada-US-Mexico free trade agreement (CUSMA) that replaced the North American Free Trade Agreement in 2020.

Agriculture minister Marie-Claude Bibeau made the announcement November 14 at a dairy farm in Quebec.

Dairy producers will benefit the most from the funding.

Ottawa will provide $1.2 billion in direct compensation to dairy producers over six years beginning in 2024 through the Dairy Direct Payment program, Bibeau said.

“The owner of a farm with 80 milking cows may receive compensation through a direct payment of about $106,000 in six yearly instalments on a declining scale,” the statement announcing the compensation stated. “These funds will give producers the flexibility to invest according to their individual needs,”

A further $300 million is earmarked for a new program to be developed in partnership with industry that Ottawa says will “support innovation and investment into large-scale projects to add value to solids-non-fat, a by-product of milk processing.”

Poultry growers will receive just $112 million through a top-up to the Poultry and Egg On-Farm Investment Program. Originally established to provide compensation for market access lost under the CP-TPP and CETA trade deals with Canada’s Pacific Rim and EU trading partners, the program will now make $803 million available to growers over the next nine years.

Processors will also benefit from CUSMA compensation, receiving an additional $105 million through the Supply Management Processing Investment Fund to support investments in dairy, poultry and egg processing plants. Also originally established in recompense for market access provided under the CP-TPP and CETA trade deals, the fund is now worth $497.5 million.

Bibeau was chuffed by the announcement, noting that Ottawa has no intention to give away Canada’s market for dairy, poultry and eggs to foreign producers.

“We made a commitment to fully and fairly compensate the market losses suffered by dairy, poultry and egg producers and processors, and that is what we have done,” she said. “[I] reiterate our government’s commitment not to concede any further market shares under supply management during future trade negotiations.”