Report: Supply management for Pork and Beef in Canada
Recent discussions about a supply management scheme for pork and beef in Canada have generated significant interest in investigating this option further. However, it is critically important to understand the full implications of this type of marketing scheme in order to ensure informed dialogue.
Al Mussell, Senior Research Analyst at the George Morris Centre, has prepared a report on current and alternative marketing structures in the beleaguered pork and beef segments. The following is an excerpt from Supply Management in Beef and Pork: Understanding the Broader Context.
The Canadian beef and pork segments are experiencing a period of severe and prolonged difficulty, with exceptionally low margins, mounting financial liabilities and general economic stress. These issues relate to a range of factors, including softened demand for red meat, relatively strong Canadian currency, mandatory Country of Origin Labeling in the US, and higher feed costs, driven in part by demand from ethanol manufacturing.
In this environment of desperation, there appears to be a renewed interest in supply management and measures involving licensing of production capacity. However, as part of a much-need evaluation of alternatives in beef and pork, the full implications of supply management schemes must be understood to allow the discussion to evolve. Thus, the intent of this paper is to consider supply management as an alternative to the existing mechanisms in beef and pork marketing. The objectives are as follows:
• To provide an overview of the initial conditions that led to the adoption of supply management
• To consider the marketing conditions favorable to a supply management scheme relative to those in beef and pork
• To consider the trade policy instruments necessary for a supply management scheme in beef and pork
• To assess the efficacy of a supply management scheme for beef and pork
The full report is available on the website: www.georgemorris.org
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