Moved second reading of Bill C-202, An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management).

He said: Honourable senators, I rise today as sponsor in the Senate of private member’s Bill C-202, An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management). This bill was introduced by the leader of the Bloc Québécois on May 29, 2025, and was passed unanimously in the other place on Thursday, June 5.

This bill is identical to Bill C-282, which we debated at the committee report stage last December prior to adjournment, prorogation, dissolution, and ultimately, the general election held on April 28. As such, the objective of Bill C-202 is also to protect a key component of Canada’s food security in the context of international trade negotiations, that is, the supply management system for the production of dairy products, chicken, turkey, and eggs.

My presentation is inspired by what we learned from our recently retired colleague, the Honourable Brent Cotter, and will be divided into three parts. First, I will present the three pillars or essential components of the supply management system. Next, I will discuss the arguments that support maintaining supply management in the three aforementioned sectors. Finally, I will explain why the Senate is positioned to proceed swiftly with the adoption of Bill C-202.

Part 1: What is supply management? Senators, in Canada, our system of supply management was created in the 1970s following a period of price volatility in the dairy, poultry and egg industries. Supply management relies on three pillars.

The first is the control of production by means of allocating quotas designed to prevent production surpluses or shortages, which are both situations that often result in significant price fluctuations for farmers, intermediaries and consumers.

As stated in the Library of Parliament’s research publication on Canada’s supply management system:

To prevent surpluses and shortages that can cause significant price fluctuations, the national agency representing each industry is responsible for setting the national production level based on provincial demand. The Farm Products Agencies Act authorizes each national agency —

— for milk, eggs and poultry —

— to restrict production and set production quotas for each province. Each national agency may also impose penalties for overproduction or underproduction.

The second pillar is guaranteed revenues for farmers. Again, as stated by the Library of Parliament:

. . . supply-managed farmers are guaranteed a minimum price for their products. Through their provincial marketing boards, farmers collectively negotiate minimum farm-gate prices with processors. This minimum price is based on production costs and market conditions, such as consumer demand, inventory available on the market and the price of competing products.

Supply management gives farmers a fair price that reflects production costs while preventing significant price fluctuations for consumers. . . .

Finally, the third pillar is import control, which is key to the supply management system. Without robust limits on imported food staples subject to supply management in Canada, the system is jeopardized by exposing farmers to significant drops in the value of their quotas and major fluctuations in the price they receive for their agricultural output.

The Library of Parliament explains this in the following terms:

In addition to relying heavily on production control and pricing mechanisms, the supply management system also relies on import control to function properly.

In accordance with various trade agreements, Canada restricts imports by setting tariff rate quotas. This means that it grants its trading partners a “minimum level of access” to imports and imposes a high customs tariff on imports beyond a certain amount to prevent foreign products from flooding the Canadian market.

Thus, Bill C-202 seeks to protect this third pillar of the supply management system by preventing additional concessions on the import of dairy products, eggs and poultry.

At the moment, according to a calculation made by the Dairy Farmers of Canada, up to 18% of some dairy products is open to external markets. We also know that there is a huge surplus of milk in the United States. Millions of litres of milk — or gallons, as they call it — have to be destroyed. Wisconsin, in particular, has excess milk production, so it wants to have access to the Canadian market to ship this surplus.

At what point will our dairy supply system be weakened to the point of collapse? That is the question.

According to all the dairy farmers and all the dairy organizations that I met, this 18% — to which I referred before — puts them in the critical zone. If our borders open up even more, the system is finished, according to them.

According to an op-ed published on the National Farmers Union’s website, nearly 11% of Canada’s chicken is now imported, with most of these imports coming from the United States.

If we look at eggs, the production capacity of a few American industrial producers exceeds the whole Canadian production. According to Statistics Canada, Canadian egg farmers produced 915 million dozen eggs in 2024. That number seems impressive — almost a billion dozen. That’s the number for the whole country. By contrast, in the United States, Cal-Maine Foods, the top American egg producer, states on its website that it has nearly 40 million laying hens, and it sells over 1.1 billion dozen eggs annually. That’s more eggs from one company than the whole of Canada produces.

In short, no one can claim to support the supply management system while also agreeing to open our borders to the same products from the U.S. or elsewhere. Simply put, the two positions are mutually incompatible.

We must also recognize that every time that we chose to take in imports of these products, we not only reduced our food sovereignty, but we also had to pay billions of dollars in compensation to the dairy industry and other sectors. Our financial resources are limited and they can be put to much better use.

The time has come to draw the line. That is what Bill C-202 proposes by ending import-related concessions that risk destroying the third pillar of our supply management system for dairy products, poultry and eggs.