Since the 1970s, Canada’s supply-managed sectors (dairy, poultry and eggs) have been protected from imports by federally imposed restrictions. The sectors had long said they couldn’t make it without that protection. This year, we’ll see how that warning plays out.

Four years ago, with new and potentially lucrative trade deals beckoning, Ottawa realized it couldn’t keep it borders closed to imports of products such as milk, cheese and poultry from other countries if it wanted other Canadian goods to have export access abroad.

So it worked with the domestic supply-managed sectors on compensation deals. Ottawa said it would pay farmers for what it expected they might lose through access concessions it was negotiating.

This was a milestone in Canadian agricultural history. Supply management proponents argued the system, which erects tariffs against imported dairy, poultry and eggs and sets commodity prices that keep farmers in business, was part of Canadian culture. Importers should respect that position, they said.

But as trade negotiations advanced and trading partners railed against them, it became clear the culture argument would fail. The US had complained about restrictions for ages. And with trade deals also in the works with Europe and the Pacific Rim, momentum against restricted access was building.

So Ottawa opened the border and in its words announced it would “fully and fairly” compensate Canadian producers.

That resulted in a cascade of major commitments.

For example, in 2019, Ottawa announced it would compensate supply-managed dairy farmers nearly $2 billion for the impact of the European and Pacific trade deals. It also announced more than $690 million for poultry and egg producers for ramifications of the Pacific deal.

In 2021, the federal government further announced 10-year investment- and market-development programs for chicken, egg and turkey farmers worth $647 million, and another $292 million for supply-managed processors the following year.

Then last year, Ottawa committed $1.7 billion more to compensate the sectors through to 2029 for losses they may incur under the renewed US-Mexico-Canada trade deal.

Total federal compensation for all supply-managed sectors from all programs will reach $4.8 billion, if all parties take advantage of the federal offers.

As 2022 wound down, Ottawa announced it was making the fourth and final round of compensation payments to dairy farmers for concessions the federal government made to Europe and Asia.

In this final round, every Canadian dairy farmer with an average size herd of 80 cows would receive about $38,000. 

In making the announcement, Agriculture and Agri-Food Canada said the federal government “firmly believes” that Canada’s supply-managed sectors are the pillars of rural communities’ vitality.

“The system provides producers with the opportunity to receive fair returns on their labour and investments, while consumers benefit from a steady supply of high-quality products,” it said.

The federal minister, Marie-Claude Bibeau, made a point to reiterate her government’s commitment “not to concede any further market shares under supply management during future trade negotiations.”

Farmers will be leery of such commitments. After all, previous governments said supply management would never be on the table in the first place.

At this point, the best farmers can do is to take advantage of the federal compensation funding and figure out how to succeed in a less-protected world. It’s no longer around the corner, it’s arrived.