Quote:
Originally Posted by krynski
So you acknowledge that if producers leave the industry, prices would go up? Is it because there would be an oligopoly on supply as integrators step in and decide to contract grow? Would there even be domestic production as it is cheaper to produce elsewhere? Supply management ensures a consistent supply and price, what benefit is there to volatile prices?
At least in the quota system, the majority of the quota is owned by family farms, and it ensures that they are able to produce. I know how cost of production models are built, and there is no extra cost for quota, that is not built into the model. If people want to spend their hard earned money on quota, then they are able to, but they are not paid extra so that they can buy quota- that is rediculous.
You point out that my post is inconsistent, so I must ask, if cows, equipment, feed, and land are detterents enough for most people not to get into dairy farming, then why are there so many people trying to do it, driving up the cost of quota?
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The majority of the quota is owned by a 'few' farms that basically have a monopoly on the industry including a massive lobbying presence in Ottawa that is big enough to sway leadership votes.
The fact that the quota has any value is ridiculous to begin with. Many other forms of food production exist without a value being placed on production quota, and does just fine.
Pork & beef being the most obvious examples.
Removing the artificial value that quota has would absolutely allow more people to get into the industry and should absolutely lower the cost for consumers.