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The five reasons Bruce Muirhead supports supply management

Canadian egg farmers use a unique and effective system for managing the production of eggs. The system—called supply management—is an act of “Canadian genius,” per University of Waterloo professor Bruce Muirhead. Dr. Muirhead is a historian who has written extensively on Canadian trade negotiations and agriculture policy since the Second World War, as well as Canadian economic policy and international development. His recent work has honed in on supply management, a system he believes is sensible. Muirhead has a wealth of knowledge about supply management and why it works, so we asked him to identify five things Canadians need to know. Here are his answers:

1. “Our system gives farmers a voice in price setting… the chance to make a living wage.”

Dr. Muirhead has spent time with actors in the egg industry around the world, from Australia and New Zealand to the U.K, Europe, and the U.S. “Egg farmers in other parts of the world,” notes Muirhead, “face a lot of challenges: input costs are too high, there are no good returns, and you make just enough to get by.” Price setting is important so that farmers can cover the cost of producing a dozen eggs and make a stable living. Muirhead notes specifically the example of Australia, perhaps “the most deregulated” egg market in the world—a market where farmers are struggling to cover their costs and the industry’s long-term viability is in question. “If you want good food, you need stability in the marketplace, and for that you need farmers to have a voice in price setting.”

2. Supply management leads to “market stability for both producers and consumers.”

Some critics argue that consumers pay more in the grocery store for supply managed products. The evidence from outside Canada shows that is false. “In many places in Australia and New Zealand and the U.S., Canadian eggs are cheaper. In Seattle for example, Los Angeles, and New York, eggs are more expensive.” Overall, Dr. Muirhead points out with pride that Canada has some of the lowest food prices in the world. Consumers benefit from the affordability made possible by supply management.

3. “Supply management is not a subsidy.”

Dr. Muirhead lauds the balance present in the supply management system, “which is important for the sustainability of the industry.” Muirhead tells the tale of Donald Fleming, Finance Minister in the government of former Prime Minister John Diefenbaker. In cabinet meetings, Fleming would rail about the unaffordable bills that come from subsidizing dairy, poultry, and egg farming. “This is one of the reasons we moved to a supply-managed system—government wanted to make farming sustainable on its own.” Muirhead compares our system to that of America, where “every single farming sector gets subsidies.”

4. “Supply management is part of the movement towards food security.”

A hot topic amongst academics and policy makers is “food security”, ensuring that citizens have a steady supply of affordable food. For Canadians, supply management is an important part of food security. “It seems to me that whenever you ‘put all your eggs in one basket’—relying on imports—it’s a problem.” Under supply management, the Canadian egg supply matches demand for eggs from Canadians. Dr. Muirhead adds, “We have a food secure future as long as we have supply management.”

5.  “Supply management perpetuates the family farm.”

According to Dr. Muirhead, the average egg farm in Canada has about 20,000 hens—“that’s a family farm.” Compare that with our American neighbours, where some 60 or so companies have over one million hens each. It’s the family farm character of Canadian egg farming that affords not just sustainable farms, but supports the vibrancy of rural communities.

We want to thank Dr. Muirhead for taking the time to talk to us, and help us educate Canadians about all the benefits of supply management.