New trade agreement has Windsor-Essex dairy farmers nervous, but auto workers remain optimistic
Kingsville dairy farmer says end of supply management would put him out of business
Canadian trade officials descended on Washington Tuesday to rejoin NAFTA negotiations and the pressure on them couldn't be much higher.
That's because U.S. President Donald Trump suggested Canada has until Friday to negotiate its way into the deal — the alternative would see Canada face stiff tariffs on auto exports.
It's a decision which has left auto workers and dairy farmers in Windsor-Essex with mixed feelings of nervousness and optimism.
Farmers concerned with supply management's future
Supply management controls how much milk, eggs and poultry are produced in an effort to prevent the market from being flooded — ensuring farmers get a fair price for what they produce.
When a commodity is overfilled to the market, the prices depress in an exponential way which leads to bankruptcies. It's a possibility which has farmers concerned that Canada may have to give that up in order to prevent tariffs on the auto industry.
Lyle Hall, president of the Essex County Federation of Agriculture, said the economic impact of giving up supply management — subsequently forcing dairy farmers out of Windsor and Essex County — could be substantial.
"There's business there. There's fuel. There's machinery, hydro, stuff like that. It could all go away," Hall said.
When asked if Trudeau would continue to defend Canada's system of supply management for some farm sectors — in the face of entrenched and vocal opposition from U.S. President Donald Trump — Trudeau said Canada's position on that issue has not changed.
According to Kingsville dairy farmer Bernard Nelson, Canada is not a problem for the U.S. The real problem, he said, is that Canada produces too much milk.
"We already gave up three per cent of our market for the Trans-Pacific deal which was signed here a year ago. And then the U.S. withdrew from that trade agreement," Nelson said.
"If the United States wants some of our market, then they should go back into the Trans-Pacific deal and then they can have three per cent."
So would Windsor-Essex dairy farmers be able to survive if the supply management system were to disappear?
According to Nelson, the market would be flooded with cheaper products from the United States and farmers in Windsor-Essex would not be able to compete.
Optimism from the auto sector
There is some optimism from the auto sector, with some Canadian workers saying the bilateral agreement between the U.S. and Mexico is a good first step in joining the new agreement.
"What we're urging the government to do is exactly what they're doing — to get back to the table and finally get to a conclusion on this trilateral deal ... so that we can remove all of this uncertainty," said Michael Hatch, chief economist with the Canadian Automobile Dealers Association.
He added Mexico and the U.S. have made some compromises throughout negotiations and it's up to Canada to do the same.
"If Canada's in a position where we have to liberalize other sectors, bring down some other tariff barriers that exist in other sectors for the greater good of achieving a deal on NAFTA which is important to all Canadian consumers, ... then we have to face that reality."
Unifor Local 444 president Dave Cassidy is also optimistic of Canada's outlook into the U.S.-Mexico trade deal. He said, however, there are still many unknowns.
"It's so new. Our people are watching it. They're listening to what's going on ... A bad NAFTA is good for nobody," Cassidy said.
"I'm hoping that our government will realize this and ... come to some sort of an agreement that will be good for all of us — in our industry, especially."
On Tuesday, Foreign Affairs Minister Chrystia Freeland said conversations with the U.S. remain "constructive."