by SUSAN MANN
A dairy farmers’ organization has taken another step this month to convince federal authorities to apply a tariff to American mozzarella cheese in pizza kit imports used by restaurants. But it could be some time before the matter is resolved, and meanwhile the kits are still coming into Canada.
The organization is BalanceCo Canada, a non-profit corporation that is a federally registered lobbyist and has Canada’s 10 provincial milk marketing boards as its members. It has launched a request for an advance ruling from the Canadian International Trade Tribunal regarding the tariff line for the pizza kits.
It argues the pizza kits, made up of 80 per cent mozzarella and 20 per cent pepperoni, are actually two separate goods and the cheese should be classified as dairy. That classification would make the cheese in them subject to a 245.5 per cent tariff.
The Canada Border Services Agency classifies them as a food preparation. That means the cheese in the kits can enter Canada duty free.
But before the tribunal can get to the heart of the matter, it has to decide whether BalanceCo Canada has the standing to request such an appeal. The tribunal tackled that question, raised by J Cheese Inc., an intervener in the hearing, April 9 in Ottawa. A decision has not yet been released.
BalanceCo co-counsel Chris Cochlin of the law firm Cassidy, Levy, Kent of Ottawa and Washington D.C., asserts the organization should have status because, for the purposes of tariff classification the BalanceCo can be considered an “importing entity.”
“That's the standing that allows you to get an advance ruling," he says.
If permission to request the advance ruling is granted, Cochlin says typically it takes the tribunal a month to a year after a hearing to issue a decision. In this case, the timeline isn’t known because the question of BalanceCo’s standing must be addressed first.
Gillian Burnett, assistant secretary of the tribunal, says there aren’t legally defined timeframes the tribunal must follow in issuing its appeal decisions. But “we have an internally imposed deadline that we try to meet for issuance of appeal decisions,” she says – 120 days from the date of the hearing.
It’s quite rare for there to be a separate hearing on one of the party’s jurisdiction, she adds.
Border controls such as tariffs to keep imports at reasonable levels form a key pillar of Canada’s supply management system. Matching farmers’ production with demand and fair prices for farmers are the system’s other main components.
Garth Whyte, president and CEO of the Canadian Restaurant and Foodservices Association, says the association is not participating in the tribunal hearing but they’re not surprised restaurants import the kits. He points out frozen pizza makers get a significant break on cheese prices through a special class.
“For years, we’ve been saying it’s really unfair and wrong that frozen pizza makers can have a 30 per cent price advantage over fresh pizza makers using the same mozzarella cheese,” he says.
In January, the Canadian Milk Supply Management Committee took first steps towards leveling the playing field by approving the creation of a new lower price milk class for shredded and diced mozzarella cheese for restaurant operators to use on fresh pizzas.
Whyte says they’re hoping the technical details, such as the milk price and how audits will be done, are nailed down soon so they can start working towards implementing the new class this year.
He says he’s not sure that once the new lower priced class is in place it will halt the flow of pizza kits into Canada. The purpose of the new class is to sell more mozzarella and “I think it will.”
He says he doesn’t know the exact price of the pizza kits but the cheese costs are more in line with what frozen pizza makers pay for their cheese.
As for how many restaurants are using the kits, Whyte says “very few.”
Maja Graham, spokesperson for the Canada Border Services Agency, says by email the agency maintains that it had the authority to classify the pizza kits as a food preparation.
“The issue of why the CBSA came to this determination is the matter currently in litigation before the tribunal, therefore it would be inappropriate to provide further comments,” she says.
In an interview last October, Dairy Farmers of Canada spokesperson Therese Beaulieu said they don’t know when the kits started coming into Canada, but they first noticed them in fall 2011. DFC estimates nearly six to 11 per cent of the country’s total fresh pizza cheese market comes from the pizza kits. The total fresh pizza cheese market is estimated to be about 35,000 tonnes annually. BF
Comments
Since supply management is all about preventing imports, to try to label BalanceCo, the organization representing supply management, as an "importing entity", is the ultimate in cheekiness, and their action seems to serve no purpose except to stall due process. I would love nothing better than to see BalanceCo's challenge ruled to be frivolous and vexatious, and dismissed with costs assessed against BalanceCo and therefore, against the dairy farmers it ultimately, and over-zealously, represents. And yet, dairy farmers stilll can't understand why supply management is not well-liked, and will not be missed.
Stephen Thompson, Clinton ON
But there is milk products brought into Canada.
I'm sorry, but your posting ignores the obvious - if we import milk products, why do ever-increasing numbers of Canadians shop for milk in the US?
Could it have anything to do with the Dairy Farmers of Ontario admitting, in late 2010, that even their own numbers showed Ontario consumers were paying almost 38% more for milk than US consumers?
And, yes, we do import milk products, and I have one in my freezer at the moment - it's a frozen pizza kit made in Detroit, and sold by a local school as a fundraiser.
Stephen Thompson, Clinton ON
Why do people go across the border to shop period. The people should say and I don,t believe its just for dairy products and yes I seen in our farm magazine where they bring over truck loads of whey into Canada.
People cross the border because many things are cheaper. Some of those American made cheaper, products have been listed in discussions here. The supply of many items is managed by the large manufacturers-- supply management US style!
DFO where just being truthful,facts are the US and most Countries in the world where going through historic low milk prices due to a glut of milk on the world market in 2009-2010,if you go back a couple years to 07-08 you would see Canadian milk prices where actually lower than the US,as you where sitting at the border (as you seem to like doing) you might even have spotted some Americans coming up here to buy milk products.
I am a regular US shopper and I have taken the trouble to carefully compare both SM and non SM products in similar stores on both sides of the border. IE Costco vs Costco, Walmart vs Walmart, Home Depot vs Home Depot. Lastly Amazon.com vs .ca
My numbers don't support the SM bashers claims. I notice that the bashers here usually avoid commenting on specific price differences unless it's an SM product. That tells me this is really a debate about beliefs (think religion, politics) not hard facts.
If you were right, and you're not, there wouldn't be people lined up five deep in Washington State to buy US milk, and BC supply management groups wouldn't be sounding the alarm over the sales they are missing due to cross-border shopping. In addition, if you were right, and you're not, the Dairy Farmers of Ontario wouldn't have admitted, in late 2010, that Ontario consumers were paying almost 38% more for milk than US consumers, and that the farm gate price of milk in Ontario was within a few pennies per liter of the US retail price.
Furthermore, if you were right, and you're not, we wouldn't need 200% tariff barriers on dairy and poultry products.
We also, if you were right, and you're not, wouldn't have had the fresh pizza industry, on the warpath for the last number of years, complaining that they have to pay 30% more for domestic mozzarella cheese than frozen pizza makers.
I suggest there's something fundamentally wrong with your research methodology because it simply doesn't make sense, on any level.
Stephen Thompson, Clinton ON
If you were right and and you're not, the bashers here would have responded to the specific examples posted here. Also Canadians would not be bringing back so many non SM products.
Common sense is not always behind the many reasons crowds of people act the way they do. Some people with strong religious beliefs for example sometimes behave irrationally -- kind of like some SM bashers. I'm convinced that SM opposition is more about a belief system than rationality. The obsession like devotion of the bashers is no different than a religious zealot.
It is complete fantasy for supply management supporters to believe that what they claim is the highest farm gate price of milk in the world, somehow magically disappears by the time milk gets to the retail level - it is, as well, only good common sense that the highest price in the world at one end of the marketing channel is going to result in a high price at the other.
Secondly, one of the most-basic principles of economics, and only common sense, is that tariff-based systems, such as supply management, are always net-negative. Ontario Pork figured it out, why can't dairy and poultry farmers?
Thirdly, there was nothing irrational about Ontario Pork's resolution earlier this year to urge government to place trade ahead of protecionism. Why would anyone think that effectively calling Ontario Pork "irrational" and/or "religious zealots" serves to endear supply management to anybody except the zealots who irrationally believe in it now?
In addition, because supply management itself, and/or any form of protectionism, cannot be supported by any sort of economic principles, supply management is the epitome of zealousness over rationality.
Finally, it's ironic that supply management supporters would accuse their detractors of irrational zealousness, because it's nothing more than the pot calling the kettle black, as well as prompting the completely-rational observation that supply management supporters truly are "archers with no arrows".
Stephen Thompson, Clinton ON
Pork producers are not in a position to throw stones at dairy or other sm producers.
For many years the pork industry has drunk at the taxpayer funded trough . Questions for the economist. How many millions have Canadian taxpayers given pork producers both to stay in business or more recently to go out of business? How much have pork industry bankruptcies cost suppliers?
Not a great advertisement for the non sm sector is it?
The answer to your question is...the cost has likely been a small fraction of what the 200 to 300% tariffs on dairy products have cost consumers. Who is living in the glass house?
Quiet now guys! Wouldn't want to reveal how much in past CAIS/Agristability/NISA/AgriInvest/RMP plus future RMP COP support that isn't available to U.S. livestock competitors. Could spell countervail. Meanwhile, the U.S. livestock farmer has and continues to get very little in support plus they have had higher feed prices for the last few years.
Wonder what the price of Canadian pork and beef is south of the border ? Then look at the support recieved .
The beans are out of the can already . COOL already has this in their sites and is just waiting to lock on the target !
Would that answer be the same if SM was allowed or able to share in the total Ag support budget as happens south of the border ?
Many fail to realize that the problems here or south of the border are many times the same . It comes down to the big guys running the small guys out of town . SM or not we would still have the same problems for young people trying to start farming in any sector . When it comes to younger people who want to start farming , any one who is farming is and can rightly so be viewed as living in a glass house .
If you want to run with the big dogs , you have to get off the porch !
In economics, a dollar forced out of a poor consumer to be transferred to someone deemed to deserve it, has a far-greater adverse economic impact on the economy, than forcing a dollar out of a rich tax-payer to be used for the same purpose.
Therefore, it is completely inappropriate, and irrelevant, to compare subsidies paid by consumers, and subsidies paid by taxpayers including corporations who, by definition, aren't consumers.
Consumer-funded subsidies are termed "regressive taxation" while taxpayer funded subsidies are termed "progressive taxation", in part because that's exactly the effect each has on the economy.
While neither tarrifs paid by consumers, nor subsidies paid by taxpayers, represent an optimal situation in any economy, taxpayer-funded subsidies are by far the lesser evil, for jobs and economic activity, as well as for overall public policy.
And, I'm sorry supply management supporters, this is so basic to economics it isn't open to debate, or even discussion.
Stephen Thompson, Clinton ON
When it comes to trade agreements many would be surprised what is traded between countries in these agreements . It very well could be that pork is allowed into other countries in exchange for that country being allowed to ship other things here . I think when it comes to pork you must first ask how they are doing with regards to the unfair ASRA program from Quebec that they claimed was all their problem not long ago . Now they have turned their sights on SM . Who will be next ? How does this fit with OASC ? We have trade missions and junket trips happening all the time , who really knows what happens in these talks !
Equity With US Farmers ! What do their farm programs give them ? Overall support of , or commoditty specific programs ? When looking over the Risk Management Program I can only find one sector with it's numbers posted . Why for is that ?
Growing Forward II is still a wretched bad re named program still trying to fit things into a blue box , a green box and an amber box . Sort of like round holes and square pegs . Ask your MP or some one from the Federal Ag Ministers office to explain these to you . That is if they can .
So yes throwing stones is not always the best approach . But hey what do I know , I am just a farmer . I usually put my stones in a pile some where .
Is pizza your staple diet, because you can,t seem to get off that topic. I think the rest of Canada eat more than just pizza , don,t you think.
Pizza is just one part of the program of repetition that the bashers carry out. It's based on a belief that if you repeat something often enough it becomes the truth.
Why was it OK for the Dairy Farmers of Ontario to repeat, and repeat, and repeat, for 40 years, the claim that there was cross-border price equivalency for milk? Did repeating it make it true? - obviously not, because of DFO's about-face in late 2010.
Secondly, we've heard, ad nauseum, for forty years that supply management provides reasonable prices to consumers, protects the family farm, and doesn't harm other farmers, and those repetitive claims, always made by supply management supporters, aren't true either - when even DFO admits Ontario consumers are being fleeced in comparison to US consumers, when the number of dairy farms is a fraction of what it was 40 years ago, and when Ontario Pork passes a resolution urging government to put trade ahead of protectionism, the "program of repetition" carried out by supply management for forty years, is nothing but a sham, as well as being anything but the truth.
Come on, really, supply management supporters, if sour grapes, shooting the messenger, baseless assumptions, fearmongering rhetoric, and a wretched understanding of basic economic principles, are all you have, and judging from this site, it really is all you have, slay the supply management dragon, and join the real world.
Stephen Thompson, Clinton ON
Obviously l must of been sleeping at all those milk meetings l attended over the years because l don't recall any of your so-called "repetitive claims" being decussed.Ontario Pork passes a resolution for more Taxpayer money every month don't they?? They are full of resolutions!
Even though DFO may have never discussed their seemingly never-ending boasting about cross border retail price equivalency during the time you were awake at milk meetings, it doesn't mean they didn't do it - it simply means, I suggest with respect, you were so complacent, and possibly so gullible, you didn't notice.
What is important, however, is that everybody else in the farm community did notice this perpetual boasting about cross border retail price equivalency, and took offense which lingers to this day.
In addition, you're falling into the logic trap typically used by three-year-olds - trying to absolve yourself of a crime by blaming someone else for what you believe (and always without a shred of proof to support it) to be an even-greater crime.
Furthermore, you don't seem to understand that a good part of whatever subsidies Ontario Pork receives, and/or wants to receive, is little more than what is entirely-reasonable to counter the injury they suffer because of the unequal incomes and purchasing power available only to dairy and poultry farmers - without supply management driving up the price of land, hog farmers wouldn't have nearly as difficult a time as they do.
Finally, hog farmers are the victims of supply management - stop blaming the victims for finally standing up for themselves and pointing a long-overdue finger at those who are victimizing them.
Stephen Thompson, Clinton ON
If you look at the title of this story, dated sometime in mid-April of this year, it's about pizza kits continuing to come into Canada, to the great dismay of our perpetually-greedy dairy farmers, and the farm organizations which pander to them.
As far as I can tell, I'm sticking to the topic, and the story - it's a current story, it's a good story, and, for every Canadian except the greedy scoundrels in our dairy industry, a tragic story.
Therefore, I see absolutely nothing wrong with continuing to poke a pointed stick in the eye of our dairy industry, as long as they continue to fleece everybody and anybody, while, all at the same time, continuing to be two-faced bullies in the farm community itself.
Stephen Thompson, Clinton ON
Imagine that the one time you get to say that ! LMAO
It seems the whole use of this site has turned to nothing more than a sand box . These , if you were right , and you're not comments remind me of the old
" I know you are but what am I " kids response . Now really , try that argument with your wife if you dare !
A little thing like "hard facts" has never entered the equation for the SM bashers.l think most of us have been to the States at one time or another.We all know that hotel rooms are cheaper,fuel,food,furniture,drugs,vehicles, even a round of golf is way cheaper,more than a few friends fly out of Detroit or Buffalo rather than Toronto,simply because its cheaper and a some cases a LOT cheaper.So why does anyone pay attention to someone moaning constantly about Dairy or chicken price differences between to 2 countries, it simply comes down to economics of scale! You would think a Economics Professor would know that?
The only fact of any relevance, is that 200% tariff barriers apply only to dairy and poultry products, and absolutely NOTHING else.
In addition, your logic is so convoluted it's somewhat funny. While you complain we don't have economies of scale, you don't understand, or don't want to understand, that we don't have economies of scale in our dairy and poultry industries because supply management forbids it.
Furthermore, you have completely, and conveniently, ignored the fact that while economies of scale do affect our meat-packing industry, economies of scale don't seem to cause any sort of cross-border retail price differential for beef and pork.
However, the "kiss of death" for the argument about economies of scale is that if anything, cross border shopping forced on Canadian consumers by supply management, helps the US economies of scale, while at the same time, hurts ours.
I'm sorry, but the example about economies of scale was so absurd, and so fundamentally dumb, it was actually funny, but in a sad way because you obviously are grasping at straws in desperation.
Finally, and this is tragic for all of agriculture, the poorly-thought out example of economies of scale demonstrates, in spades, that dealing with the "truth-deniers" in the supply management camp, is like shooting fish in a barrel because the truth-deniers simply don't think, won't think, and/or can't think, in anything but the most-simplistic, and most-incorrect, way about almost everything to do with basic, and therefore undeniable, economic principles.
Finally, it was exactly these sort of faint-hope and "Hail Mary" arguments, seemingly-always proffered by students from dairy farms, which made teaching economics always such fun.
Stephen Thompson, Clinton ON
(519) 482 - 3244
Obviously l have hit a nerve but your not fooling anyone with your rants.No one is forced into cross-border shopping, not for air tickets,fuel,clothing,drugs not for even dairy or chicken products.The same economics of scale can apply in rural Ontario,no one forces anyone to go shop at a Big Box store in the city but then we wonder why so many small town store fronts are empty.
"The only fact of any relevance, is that 200% tariff barriers apply only to dairy and poultry products, and absolutely NOTHING else."
Not true.
It's obvious you have not gone through the entire list of duties and tariffs the USA has in place.
Just because you repeat the same thing over and over again, does not make it true.
Why is it you stick to old news 2010 , is it you have not seen or read this is August 2013. If you want to dig into anything find out whats going on today August . 20, 2013. OLD NEWS?
I keep referring to DFO's abrupt end of 40 years of boasting about cross border price equivalency of milk, by admitting, in late 2010, that Ontario consumers were paying almost 38% more for milk than US consumers, and that the Ontario farm gate price of milk was within a few pennies per liter of the US retail price, simply because it puts a dagger, for all time, through the heart of DFO's credibility.
For example, if DFO was to claim today, that we were paying 10% more for milk than US consumers, everyone would ask, - "But when is it going back to 38% again?", or "Was it 38% six months ago?".
More to the point, I keep coming back to it because it makes supply management supporters mad enough to spit nails because it exposes, for everyone to see, supply management for what it really is - gouging by greed-driven farmers who care about nobody but themselves, and who want desperately to hide the truth about what they are doing.
It's like this - forty years of successful boasting mean nothing when one has to spend eternity living down one damning incident - and DFO can't ever live it down, nor should they ever be allowed to do so.
Most importantly, this admission, by DFO, is still so damning to their cause, that it makes me proud to sign my name to my postings lambasting the greed, the duplicity, and the double standards which constitute supply management, and this admission by DFO is also, I suggest, why supply management supporters on this site are still too-ashamed to do likewise.
Stephen Thompson, Clinton ON
Write your name and get a surprise , that's what you have to worry about.
Why not be personal bullied and called names.
Yet another anonymous cheap shot from yet another supply management supporter who, because he/she cannot deny that supply management is, by the first principles of economics, net negative, as well as pitting farmer against farmer, does the only thing supply management supporters can, and always, do - shoot, insult, and bully, the messenger.
What is it about having supply management continually exposed, by people who aren't ashamed to do so, as a greed-driven, dysfunctional method of transferring large amounts of wealth from disproportionately poor consumers to a clique of rich bullies, that dairy and poultry farmers cannot understand, or, more aptly, refuse to understand?
Stephen Thompson, Clinton ON
PIZZA PIZZA PIZZA PIZZA is this what people are eating today , good thing they don,t drive , use hydro or pay lots of taxes because I though pizza was the only high price thing in Canada. Consumers are being taken to the cleaners by the SM farmers well I tell you I live in Canada and it seems everything I have to buy to live on is running on the very extreme and its not just some SM farmers that is driving the price of the things I buy in Canada.
Once again, the initial story was about imported pizza kits, and therefore, it is entirely appropriate to focus one's comments towards pizza, and the wretchedly-greedy policies of our dairy industry, policies which care not one whit about consumers, policies which forced this completely appropriate, and well-deserved, end run around supply management in the first place, and are policies which focus only toward the unmitigated greed of dairy farmers and the farm organizations which pander to them.
The story wasn't about anything but pizza - therefore, I can only assume you're trying to divert attention away from the real story, the only story, and that is about the evil-doings by supply management for the sole purpose of gouging consumers.
It's like every supply management supporter pretends that (A) DFO never boasted for forty years about cross-border retail price equivalency for milk, and that (B) dairy and poultry products aren't the only things facing 200% plus tariff barriers.
Get with it dairy farmers, and supply management supporters, you fed us this cross border retail price equivalency rot for forty years, and gloated all the time - you're now going to have the true extent to which supply management really gouges consumers (because of the 200% tariff barriers applying only to dairy and poultry products) shoved just as much in your face for the next forty years, as you gleefully stuck it in our face for the previous forty years, if supply management, God forbid, lasts that long.
Stephen Thompson, Clinton ON
Bang on pal , Bang On !!!
What is the price of pork and beef on both sides of the border ?
You're grasping at straws - when, as what happened about a year ago, a gang of people got arrested for smuggling cheese into Canada, a similar gang gets arrested for smuggling beef, or pork, into Canada, you might have a point, but, at the present, you simply do not, and it will be a long time, if ever, before you do.
For about the umpteenth time, what is it about the obscene 200% plus tariff barriers which apply only to dairy and products, and the horribly adverse effects that has, not just on consumers, but on the entire Canadian economy, that supply management supporters just simply refuse to understand?
Stephen Thompson, Clinton ON
I.m not total for or against SM , because its great that it keeps the farmers in line but on the other hand the big guys get even bigger and the small guys are forced out. They should allow more people in and not have a little draw to bring in a couple. The prices in the store can and should be lower than what it is because they know what they are getting as a pay cheque which is partly why the quota system works. Greed is out there and its not limited to the SM farmers the other farmers are grabbing whatever land they can get as well. Go to the stores and you will find different price on the SM products so its not just what the farmers get for their produce , the stores get to charge what they want.
There,s more greed out there than just in the Milk Circle. But I only own a couple of thousand acres and want cheap land but SM farmers are raising the price. But I want cheap land because I have money from my other career and SM Farmers are driving up the price. But I need cheap Quota and now its locked in I want to expand big times but there,s no Quota to be bought. But I,m a young person that wants to farm and can,t because there is too many old farmers out there. There is tons of greed out there its no confined to the SM farmers.
but government legislated capitalism is where I draw the line. Before anyone goes into a rant about subisidies for grains, oilseeds, beef or pork, remember that those subisidies only kick in in times of need, so some years those farmers get nothing at all. Ethanol, SM and the GEA are all basically government legislated capitalism for those who participate, especially SM because of the quota that comes along with it. Governments worldwide should all push to reduce subsidies in agriculture and bring tarriff walls down. In addition, I have no qualms with old farmers wanting to continue to farm, why should they be forced out.
Nowwhere is there even the slightest thought given to all those fresh pizza outlets, and there are arguably more of them in Canada than there are dairy farmers, trying to make a living with cheese, the most expensive ingredient in any pizza, and which costs them 30% more than they need to pay, simply to sustain the greed of Canada's dairy farmers. There's a lot of wilful-blindness in this matter, and it's all on the part of dairy farmers. I wonder what their Plan B is if they quite-deservedly lose? Nah, they don't even understand the concept.
Stephen Thompson, Clinton ON
How else do you think Dominoe's and Pizza Pizza are able to sell 5$ pizza's or 9$ large pizza's ruining the market for other Pizza places? If they had to pay what we pay for cheese, they would close store after store ..
Yes but if Pizza Pizza closed stores I would have to stop eating pizza... either that or some millionaire dairy farmers might have to face the real world!
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