Recently the Food Professor, or Sylvain Charlebois, has pointed out the lack of innovation in the Canadian dairy industry — which he says has partly been caused by the lack of Canadian sovereignty in the industry, with many of its processors having become internationally owned.On the Western Standard's Cory Morgan Show on Wednesday, Charlebois mentioned many foreign entities have bought up large chunks of Canadian dairy processors, that make different dairy products."We have no innovation, and we're allowing foreign companies — foreign countries — to come in and build and buy processors, which to me are the key asset we need to focus on when it comes to growing the dairy sector," stated Charlebois."China built a dairy facility in Kingston, the Americans — Coca-Cola — actually built a facility in Peterborough for lactose-free milk [Fairlife]. Lactalis just bought the cheese division of Agropur — that's a multinational coming from Europe.".WATCH LIVE: Why $100 cheques and grocery ‘bonuses’ are just expensive distractions.This, as Charlebois highlights in an article on his Substack, magnifies a problem with Canada's supply management system.Supply management regulates the milk, dairy, and egg industries by controlling the production of these products.It does this by requiring farmers to purchase quota permits, allowing producers to sell a set amount of product, and limiting the amount of foreign imports.The quotas and restrictions on foreign imports allow dairy producers to raise prices, because supply stays tight and costs stay high for consumers..Since its inception, Canadians have been aware the system has been a trade-off: paying a premium for dairy products to keep domestic dairy production strong and protect the Canadian dairy farmer market, exchanging increased prices for stability, predictability and a secure domestic food supply. But as Charlebois points out, the Chinese dairy giant Feihe constructed Canada's largest infant formula manufacturing facility in Kingston, Ontario, a few years ago, calling it "a major investment in Canada’s dairy sector."In July 2024, production at the facility was launched, and Canada Royal Milk, a subsidiary owned by Feihe, launched its Niuriss infant formula brand. What appeared to be a gain for the Canadian economy and dairy industry is actually mostly just a gain for China — government records revealed that planning documents projected 85% of production would be exported to China..With Canada only projected to represent a very small fraction of the sales.The documents "strongly suggest that exports have already occurred to markets including China and potentially the United States."This brings into question problems still left unsolved in Canada — including periodic baby formula shortages and higher prices, with baby formula increasing by more than 70% over the past five years.Supply management, whose purpose is to protect Canada's food industry, is now allowing a Chinese-owned processor to operate in Canada purchasing quota protected milk while selling the product beyond Canada's borders. .The story of course, does not end there.According to Charlebois, records also show $24 million of public funds, through the Agriculture and Agri-Food Canada’s Supply Management Processing Investment Fund, was given to the processors' project.Another portion remains redacted, which suggests the possibility of more money being given towards the project.However, if supply management was meant to defend against foreign competition as many politicians suggest, why has a "Chinese-owned company become one of the most significant processors in a highly protected segment of Canada’s dairy industry, using supply-managed milk while pursuing export markets abroad," stated Charlebois.."More and more, we're losing control of our own dairy sector despite supply management, and that's a big problem," said Charlebois on the Cory Morgan Show.He added on the show that supply management was meant to protect dairy farmers and their families — yet the amount of quotas allocated to each province usually doesn't match demand. "We're supposed to produce what we need by province.""Quotas are managed by provinces, but the reality now is that Quebec, for example, produces 37% of all the milk and butter fat we need in Canada, with only 20% of the population.".Indeed, according to Statistics Canada, records showing the amount of dairy quotas allocated to each province in 2024 and 2025 indicate Quebec received the most, accounting for 37% of the quotas, the highest amount of all the provinces. While the province has only around 22% of the population."If supply management is designed to protect Canadian food sovereignty, why are Canadians helping finance a Chinese-owned dairy plant whose original business model relied overwhelmingly on exports?" asks Charlebois.
