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The Rural Voice, 1987-10, Page 31the resultant jobs. — statement by the Ontario Cattlemen's Association, the Ontario Pork Producers' Marketing Board, and Ontario Members of the Canadian Meat Council Dairymen and poultry producers are as convinced they cannot compete in such a market, and despite assurance by Minister of Agriculture John Wise that marketing boards are not negotiable, the supply management boards are not con- vinced. They fear that while their boards will be left intact, import restric- tions, which are vital to their existence, will be dropped. Statements by U.S. congressmen have prompted these fears, and perhaps the fears are justified. The Canadian side has not issued any statement to the contrary. "It is important to realize that "free" trade will not work for all sectors of the economy. The dairy industry is an example. It is oriented to the domestic mar- ket and has achieved a balance that benefits all of society. Disrupting this sense of order would only hurt Canada and the Canadian Economy." — Ontario Milk Marketing Board newsletter, Skim Not everyone agrees, however, that Canadian farmers with supply manage- ment systems could not compete under a freer trade deal. John Groenewegen, a senior analyst with the financial consulting firm Deloitte, Haskins, and Sells, told farm writers last year that under freer trade the poultry industry would expand in Ontario but lose in most other provinces. This, he said, is because Ontario poultrymen sit right in the middle of the cheapest feed grain in the world (assum- ing that subsidies are equalized). Since U.S. poultry production is concentrated in the American southwest, Iowa corn must be freighted there. Since feed comprises 50 per cent of production costs, Groenewegen said, Ontario poultrymen shouldn't worry about freer trade. He added that prices would be lower, thereby increasing demand. The resulting benefit of scale would com- pensate for the lower price. "While the Canadian govern- ment has made it clear that it is committed to the preservation of supply management systems and their attached underpin- nings, it has become equally clear that tariffs are not consi- dered to be part of such under- pinnings and that trade negotia- tors consider tariff removal a priority item. This has raised serious concerns in the Ontario poultry industry which firmly believes that tariff removal would be highly detrimental to their particular sectors and the overall industry." — the Ontario Poultry Industry Committee on Tariffs and Trade It seems, in fact, that the greatest problem for supply -managed poultry sector will probably not come from freer trade with the U.S., but from freer trade among Canadian provinces. There are few, if any, provinces that can compete with Ontario in poultry. Internal freer trade would shift more of the industry from the west and the east to Ontario. In other commodities such as corn, soybeans, and canola, equalization in terms of subsidies would benefit Can- adian growers, and soybean producers in particular if the high U.S. tariff on soya oil (22.5 per cent) were removed, according to John Groenewegen. And a trade agreement would extend U.S. protectionism to include Canada, thereby for the first time allowing Canada into a large market similar to that enjoyed by the U.S. and the Eur- opean Economic Community (EEC). The Huron Federation of Agri- culture, in a brief to the Liberal Task Force on Agriculture on January 30, 1986, stated that there was little scope for increased agricultural trade with the U.S. Instead, the brief said, we must look elsewhere for new markets for our expanding production. Ontario's Minister of Agriculture and Food, Jack Riddell, has made similar statements. But this attitude seems to be wishful thinking. The Ontario Pork Producers' Marketing Board, for instance, has done extensive research on finding markets for pork in the Pacific Rim and Carib- bean countries, with limited success. There was an increase in exports to Japan, but in terms of total pork exports it was small. Or consider, for example, that a city like Toronto consumes more food than most island countries like those in the Caribbean. "How on earth we imagine that as Canadians we're going to sell the world its food down the road is crazy — it's hopeless. The world is growing its own food now ... We've got to con- trol the production system for the benefit of those involved." — Professor Tony Fuller, University of Guelph, research advisor on an EEC -commissioned study of how European farm families are managing to survive agriculture in the '80s. In addition, anywhere where there is a market for agricultural products the EEC, and now also the U.S., is flooding these markets with subsidized products, leaving the U.S., in many cases, our only significant export opportunity. FACT: Farm subsidies in the U.S., which are paid primarily through loans and direct income support, were about $23 billion (U.S.) in 1987. The EEC spends about $90 billion (in- cluding EEC and national budgets) a year on its support systems. Japan's agricultural support programs are worth more than $20 billion a year. In Canada, the sum this year is $6 billion (Can.), including the $1 billion special grains subsidy. For Third World Nations, the strain imposed by international subsidies is even greater. OCTOBER 1987 29