Dairy farmers in Canada are losing out on selling to food processers as diafiltered milk from the U.S. is given preference over locally produced milk which is more expensive.
U.S. Dairy farmers who are close to the Canadian border export the diafiltered milk to Canada where it is extremely popular for use by food producers.
Canadian farmers have even said they are losing out on hundreds of millions every year due to the import of diafiltered milk.
While Ultrafiltered milk is a fluid ingredient that contains lower levels of lactose and higher levels of protein than regular milk. An additional process called diafiltration results in additional carbohydrate removal making it have a high concentration of protein, about 85 per cent, and very little of the fat and lactose that make up natural milk.
Dialfiltered milk is currently being imported into Canada as an ‘ingredient’, allowing it to enter into Canada tariff free.
The Canadian government does not charge a tariff on it, because if it were to be dried into a powder, it would have the same amount of protein as the kinds of protein powders allowed to pass through tariff-free under trade agreements.
However, it remains significant that it is not a powder and some food processors do not wish to see it as a powder, rather considering it as milk. It remains an alternative to be used instead of traditional milk at much cheaper prices than milk produced by Canadian farmers.
Globally diafiltered milk is not a big commodity, trade is negligible, but Canadian food processors seem keen to use it whenever they can.
“Some food processors here have started to become addicted to it because it’s so economical,” Sylvain Charlebois, dean of management and aprofessor in food distribution and policy at Dalhousie University in Nova Scotia said.
“It’s a fairly new thing, it doesn’t cost a fortune to transport from the U.S. to Canada”, Charlebois said.
Dairy farmers from Ontario and Quebec raised this issue when they demonstrated on Parliament Hill. Their key demand was for the government to end import of this controversial commodity.
If diafiltered milk was categorized as milk, then this argument would cool off as it would not make sense for any Canadian producers to continue importing it.
It also remains relevant that the government prioritize upgrading the food processing sector to be more competitive while bringing about innovations in the dairy sector.