Understanding Trade Rate Quotas – Dairy
The Canadian dairy sector operates under a supply management system that regulates production, sets prices, and limits imports through tariff-rate quotas (TRQs). Quotas are allocated to Canadian cheese or dairy quota holders, who manage a portion of the allowable imports annually, as overseen by Global Affairs Canada. Imports within the quota are subject to low or no duties with a certificate of origin, while imports exceeding the quota face prohibitively high duties.
Quota sales in the dairy industry are measured in daily kilograms of butterfat or the equivalent production of one cow. The Canadian Milk Supply Management Committee administers and sets these quotas in August of each year to ensure stability in production and pricing.
TRQs allow limited imports at reduced duty rates until the quota limit is reached (Within Access Commitment), after which higher duties are imposed (Over Access Commitment).
Managed by International Trade Canada, TRQs cover products such as:
- Cheese
- Milk and Cream
- Yogurt
- Ice Goods
- Butter
- Buttermilk
- Dairy Blends
- Margarine
Importing these products requires a quota holder, who has an annual limit on the volume they can import.
A comprehensive list of quota holders is available through International Trade Canada, including those specific to theCanada-US-Mexico Agreement (CUSMA). This system maintains market stability while permitting controlled access to international products.
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