Hon. Pierre J. Dalphond 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.
Part two: Why should we protect supply management?
Colleagues, let me tell you why I support supply management. I will address four points: first, the importance of supply management to the economies of most provinces and regions in our country; second, the impact of supply management on rural communities across Canada; third, supply management’s role in a greener economy; and fourth, supply management as a critical element of our food security.
With regard to my first point, I firmly believe that this bill serves the best interests of all Canadians across all regions and provinces. To illustrate this, I will highlight a few numbers. They are current, as they were published by Statistics Canada last month.
According to Statistics Canada, further to an analysis performed at my request by the Library of Parliament, supply management cash receipts, as a share of total farm receipts, is 22.4% in Ontario. That is almost one quarter of the cash income of farmers in Ontario.
In the Atlantic provinces, it’s 47.5% for Newfoundland and Labrador, 33% for Nova Scotia, 16.7% for New Brunswick and 15.3% for P.E.I. In British Columbia, the number is 34.9%. Thus, in all these provinces, supply management ensures that a substantial portion of farmers receive fair compensation for their products and are able to continue to produce dairy products, eggs, chicken and turkey, and continue to invest in their farming operations with the knowledge that they can benefit from a stable income, now and in the future.
My second point relates to the impact of supply management on villages and small towns across the country. Supply management is considered vital for sustaining small-scale family farms in the Atlantic provinces. This is also the case for small- and medium-sized farmers producing milk, eggs and poultry in other parts of the country.
These farms not only occupy a substantial part of rural Canada, but also provide a way of life for family-run businesses and keep our villages active and viable. Supply management systems are thus an integral part of our policies aimed at sustaining rural Canada and maintaining a strong presence on the land.
Opening our borders to the importation of eggs, poultry and milk — products often supplied by a handful of large corporate entities capable of dominating the Canadian market — can only result in the closure of multiple farms across Canada.
Let us take the U.S. egg market as an example. Many farms in the U.S. have well over a million egg-laying hens, whereas the typical egg farm in Canada has about 25,000 egg-laying hens. In fact, Cal-Maine Foods — the producer I briefly referred to earlier — is solely responsible for 20% of the U.S. egg supply. Thus, one company controls 20% of the market. Incidentally, those who suggest that supply management drives up consumer prices may be interested to know that Cal-Maine Foods is currently under investigation by the U.S. Department of Justice for alleged price fixing. Our system for pricing is much more transparent than that used in the United States, and it’s based on real costs.
It’s a similar story with the dairy industry. In Canada, as of 2021, the average size of a dairy herd was 96 cows. In the U.S., as of 2022, it was 337 cows. That’s more than three times the size of a Canadian herd. Also, in the U.S., which does not have supply management, the number of dairy farms has dropped by 95% since the 1970s.
As of 2024, over 60% of American milk production was on farms with more than 2,500 cows. That’s 25 times the size of the average Canadian farm. That is a lot of cows. I am not sure their cows are much larger than ours, but they certainly have produced a lot of milk.
Moving to my third point, it must be noted that supply management aligns with the ecological imperatives of our time by fostering shorter supply chains. The fresh milk sold in Nova Scotia is not hauled from places like Wisconsin.
In fact, according to the Dairy Farmers of Canada, Canadian dairy producers are among the lowest emitters of carbon per litre of milk in the world: 0.94 kilograms per litre, compared to that of the U.S. of about 2 kilograms per litre — twice as much.
My fourth point is my belief that it’s legitimate for a country — indeed, even a duty for every country — to adopt measures that protect, as far as possible, its ability to produce food locally for its citizens instead of becoming increasingly reliant on foreign sources that may well prove unreliable from time to time, as we have seen in the past and more recently.
As we saw during the pandemic, it is undesirable to depend upon foreign imports for vital products. Indeed, a few weeks ago, the National Farmers Union emphasized the importance of building resiliency and food sovereignty, highlighting food supply and agricultural production challenges caused by recent tariffs imposed by someone close to us on the other side of the border.
They said:
Canadians must have secure access to the food we need by developing our capacity here at home. Farmers must be confident that their operations will be protected from economic uncertainty.
By refusing to open further access to our market for dairy products, eggs, chicken and turkey, Canada protects its ability to produce high-quality sources of protein at home to feed Canadians, instead of relying on foreign supply.
We also saw recently that when one of these major foreign suppliers suffers from avian illness, they are forced to destroy millions of eggs, and a single egg increases to a price much higher than that of a dozen eggs in Canada.
By permitting additional imports, we would not only threaten supply management, but also erode our capacity for food sovereignty.
For all these reasons, it is unsurprising that Canadians strongly support supply management for dairy products, eggs and poultry. According to an Abacus poll conducted in November 2023, 94% of Canadians consider it a good thing that dairy products, eggs and poultry are produced by farmers within Canada’s supply management system because that guarantees a reliable supply of good products. Simply put, supply management is a widely supported Canadian approach to ensuring food sovereignty, maintaining quality and promoting a greener economy.
That is why all other parties represented in the House of Commons joined with the Bloc’s 22 elected MPs in fast-tracking Bill C-202.
I must also add, for the record, that Bloc Québécois members were not the first to introduce bills protecting supply management. In fact, the first attempt dates back to November 4, 2004, during the Thirty-eighth Parliament, with the introduction of Bill C-264, entitled An Act for the recognition and promotion of agricultural supply management. It was introduced by the Liberal MP for Kitchener—Conestoga Lynn Myers.
This same bill was reintroduced in 2006, during the Thirty-ninth Parliament, by the Honourable Wayne Easter, a Liberal MP from Prince Edward Island, who is well known, I’m sure, by my colleague on the National Finance Committee.
Of course, the policy proposed by Bill C-202 doesn’t mean that there shouldn’t be improvements to the way the supply management system works within our borders. As I said in December, I was shocked to see huge quantities of Canadian milk being thrown away every year. Incidentally, this is also the case in Wisconsin, where there’s no supply management for dairy products.
I am also concerned by restrictions that prevent innovation. But these issues — as important as they are — must be dealt with in the framework we have put in place via improvements to the supply management system within our borders, not by destroying that system. Further opening our borders to foreign products is not the solution to addressing these concerns. It is a way, however, to jeopardize our food sovereignty.
For my final point of part two, I would like to draw attention to Quebec’s perspective on this issue, because it is very important to me as a senator from La Belle Province.
As I’ve shown in my previous comments, Bill C-202 does not address a matter of interest to Quebec alone. However, the fact remains that supply management is an important policy in Quebec, one that I cannot ignore.
Bill C-202 and its predecessor, Bill C-282, were both introduced by the Bloc Québécois, which is a good indication of supply management’s importance to Quebec’s rural economy and our way of life.
As I’ve mentioned before, I grew up surrounded by dairy farms. I baled hay. I transported thousands of chicks from hatcheries to poultry barns. I even worked in a poultry slaughterhouse. I also delivered animal feed to so many hundreds of farms that I lost count.
I was the first boy in a family of four children, and at the time, my father delivered feed to all the farms around Joliette. When he took my mother and me along in the truck, I would find myself snugly wrapped between my parents as we made our deliveries. As a result, all the farmers in the area knew me well before I started school. In fact, my first grade teacher, who knew my father well, recognized me right away and welcomed me by saying that she remembered how dark my eyes were when I was one year old.
In Quebec, cash receipts from supply management represent 36% of total farm receipts, according to the most recent Statistics Canada data I mentioned earlier. That’s more than in Ontario, about the same as in British Columbia and much less than in Newfoundland and Labrador.
Last week, Martin Caron, President of the Union des producteurs agricoles, or UPA, Quebec’s largest group of agricultural producers, congratulated MPs in the other place on their unanimous support for protecting supply management and called on the Senate to study Bill C-202 swiftly.
This view is shared by various representatives of processors that purchase supply-managed products. They told me they appreciate the reliable, high-quality products and the price predictability that supply management provides.
Furthermore, as I said last December, Quebec’s National Assembly has adopted six resolutions in favour of protecting supply management in international trade negotiations. The latest was adopted on March 10, 2021, after CUSMA was signed. It reads as follows:
THAT the National Assembly recall that the agricultural sector plays a key role in Québec’s economy and regional development;
THAT it reaffirm its support for the protection of the supply management system for egg, milk and poultry producers;
THAT it ask the Government of Canada to fully protect the supply management model under future international agreements.
I also note that successive Quebec governments have all emphasized the need to shield supply management from outside pressures, particularly during trade negotiations, in order to protect the agricultural economy and the vitality of Quebec’s rural regions.
Last February, the Premier of Quebec, the Honourable François Legault, said that Quebec was prepared to compromise on a lot of things but not on supply management. He said the following:
We are prepared to make many compromises . . . . However, supply management, as well as the protection of French and culture in international agreements, are non-negotiable.
This position reflects a broad consensus in Quebec. The Abacus Data poll which I referred to earlier showed that 92% of Quebecers feel that local farm production under supply management is either a very good thing or a good thing.
However — and I want to emphasize this point — while my role in representing Quebec informs my support for Bill C-202, it was not what motivated me to sponsor this bill in this chamber. That decision was driven by my firm belief that Bill C-202 is in the national interest, benefiting a substantial portion of family-run farms across the country and being an important part of the food security of this country.
The third and final part regards why the Senate should move quickly. Colleagues, up to this point, I have focused on the policy merits of Bill C-202, and I hope that has been persuasive. But if you remain unconvinced by the benefits of supply management and are of the view that it does not deserve the protection proposed in this bill, I respect your position and your right to express it, in this chamber or elsewhere. However, I believe that we must act expeditiously with the current bill. I also believe that the Senate is in a rare position to move promptly with Bill C-202.
As you know, Bill C-202 is exactly the same as Bill C-282, which was passed by the House of Commons in June 2023. It received the support of all leaders and a strong majority of members of all parties.
In the Senate, it was introduced and read a first time on June 21, 2023. It passed second reading in April 2024 and was then carefully examined in committee. When the Senate adjourned for the end-of-year recess in December 2024, we were debating the committee’s report. The dissolution of Parliament and subsequent election brought the debates to an end.
During the election campaign, all party leaders spoke out in favour of protecting supply management, particularly during the debate broadcast in French.
During the recent election campaign, Prime Minister Carney — then a candidate — made it clear that supply management will never be up for negotiation. He said, “Supply management will never be on the table . . . .”
Moreover, page 14 of the Liberal platform stated that a Liberal-led government would:
Keep Canada’s supply management off the table in any negotiations with the U.S. We will protect Canada’s commitment to supply management and supply-managed sectors, including dairy, poultry, and eggs. This will protect Canadian jobs, insulate these segments of our food supply from fluctuations in production costs, and guarantee Canadian farmers a minimum price for their products.
In March 2025, during his visit to the beautiful region of Montmagny on Quebec City’s south shore, the leader of the Conservative Party, Pierre Poilievre, promised to defend the supply management system. In April 2025, Le Droit reported that the NDP team also intended to fight to uphold supply management.
In the Speech from the Throne read by King Charles III in this chamber, the government reiterated its commitment in these terms:
The Government is determined to protect . . . the people who give us access to fresh, healthy, and quality food: agricultural producers. And it will protect supply management.
On May 29, in the House of Commons, Prime Minister Carney stated, and I quote:
Supply management will never be on the table in negotiations with the Americans. We will protect supply management. There will be a direct response. We will protect the French language and Canadian culture in its entirety in any discussion or trade negotiation with any country around the world, including the U.S.
We will carefully consider the Bloc Québécois bill that was introduced this morning.
Last Thursday, after studying the bill, the House of Commons passed Bill C-202 by adopting the following motion:
That, notwithstanding any standing order or usual practice of the House, Bill C-202, An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management), be deemed read a second time and referred to a committee of the whole, deemed considered in committee of the whole, deemed reported without amendment, deemed concurred in at report stage, and deemed read a third time and passed.
Thus, it took less than four minutes to complete the three readings and the committee report stage.
The adoption of this motion therefore aligns with the position taken by all the leaders and their parties during the campaign, the Speech from the Throne, and the Prime Minister’s reply.
By adopting the motion on Bill C-202 last week, the Prime Minister, the cabinet and the leaders of the opposition parties wanted to send a clear message to our American neighbours. In other words, they spoke with one voice. In this context, I urge the Senate to adopt Bill C-202 in a timely way, as the matter has some urgency.
In December, the new Leader of the Opposition in the Senate, Senator Housakos — who just left — said:
On a number of opportunities, the Americans have been trying to chisel down supply management. It’s been a point of contention for them in a bunch of negotiations.
The review of the Canada-United States-Mexico Agreement, or CUSMA, is right around the corner. . . . if we show the Americans that we’re ready to bend before we even start the negotiations, and if we show that we’re ready to open up that crack because Parliament isn’t homogeneously and unanimously behind a strong defence of our agricultural sector at the start of the negotiations, then we’re dead before we get to the table. You always negotiate from a position of strength, not from a position of weakness.
I’m not as good a speaker as he is, but I tried to translate these words through my own voice, because I fully share these words, and I fully agree with his analysis.
In this context, we as senators have a responsibility to support the unity of the House of Commons on this matter and to add our support for Bill C-202. In doing so, we lend strength to the position of our government and, indeed, the collective stance of Canada’s elected representatives.
To delay passing Bill C-202 will send a contrary message and will weaken our position during the tough negotiations currently under way with our neighbours. With Bill C-202, and irrespective of our individual policy views on which reasonable opinions may differ, we as senators have an opportunity to reaffirm our relationship of democratic deference to the other place and our united support to Canadians.
To do otherwise would convey a message of division to the American administration and also suggest to Canadians that the personal views of unelected senators should prevail under any circumstances, regardless of the cost to the country.
For all these reasons, colleagues, I ask for your support for Bill C-202, as well as a pacing of our deliberations that reflects the priority accorded to this subject by our elected colleagues in the other place, by the government and by a majority of Canadians.
Thank you very much for your attention. I’m ready to answer any questions you might have. Meegwetch.