this post was submitted on 05 Nov 2023
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Just watched a thing yesterday about milk companies dumping tanker after tanker of perfectly good milk, because they don't want the prices to drop.
that would be artificial scarcity
In Canada dairy is regulated. Hopefully all food becomes regulated soon. Real hard push back from the right even though they complain the liberals are doing nothing about food prices.
In Canada, regulation is the reason they dump milk. Regulation creates milk quotas that they are not allowed to exceed. Farmers do not benefit from this, they would certainly sell more milk at a lower price if it was allowed.
I mean that’s your speculation, however the contrary of your speculation (companies literally dumping extra product so that they DON’T sell it at a lower price) has already happened. So I don’t think your speculation is accurate.
It's not speculation. It is a fact that Canada's dairy is sold at a fixed cost, so farmers aren't even allowed to lower prices to open up market demand among a population that already way over pays for food. The farmers say they dump it because they can't sell it, and all reporting around the cases say they are dumping it because they can't sell it. BC and Ontario happen to be where many of the viral milk dumping videos come from, and they happen to be the most heavily regulated provinces. American corporations do something similar in that they make contracts with farmers, so when excess milk is produced, they have to dump it since they aren't free to market it themselves anymore.
The problem is clearly market capture, whether its by corporations or the government. There is a clear cause and effect relationship between being told you're not allowed to sell milk, and dumping milk rather than marketing it. It's a very straight forward problem we're seeing.
Please think about why your hypothesis makes no sense, if I can't sell milk at $10, but I can sell it at a lower price, would that not be favorable to dumping it? If the problem is greed, would greed not incentivize me to make every cent I can out of that milk?
Newfoundland has one of the largest amout of dairy farms in Canada and not a single one dumps milk.
True. I believe Newfoundland farmers have more freedoms in who they sell to and for what prices. BC and Ontario both sell their milk through a provincial dairy commission, and since the commission stopped taking in milk, and they can only sell through them, the milk had to be dumped. If they had fewer regulations in BC and Ontario that allowed them to market their product at lower prices to other sellers, they wouldn't have had to dump it.
Newfoundland(And most of Canada) literally has 2 companies to sell to.
Then evidently having 2 to sell to rather than 1 governing board of commissions worked better, right?
Dairy and meat prices still are overpriced over there, so I'm not surprised there's only 2, but it also makes sense that something as absurd simply dumping excess can only happen when there's only one buyer who has 0 incentive to negotiate price
Actually, I took your word for it when I first read this response, but it turns out dairy farmers in Newfoundland were asked to dump milk by their provincial dairy association. So yes, they have had to dump milk, and it was directly caused by the provincial dairy commission.
Also, the whole milk dumping thing became viral because of Ontario specifically, each case of which was cause by government regulation: https://globalnews.ca/video/9459508/milk-dump-dairy-farmer-exposes-where-excess-milk-goes/ https://toronto.citynews.ca/2023/02/02/dairy-farmer-dumping-excess-milk/ https://torontosun.com/opinion/columnists/lilley-viral-video-shows-canadas-dirty-dairy-secret-we-dump-lots-of-milk
Your source relates to the dumping of milk due to demand drop during covid. Can't sell spoiled milk.
But you can sell unspoiled milk for lower prices. Regulation prevents them from lowering price or selling to other marketers. That's a fact. Regulations restricted sales. Regulation restricted dropping prices.
Regulation causes dumping, free markets cause lower prices. You have not falsified that idea yet.