New Documents Reveal Export Intentions for Canada Royal Milk
Newly released government records show that Canada Royal Milk, a Chinese-owned infant formula facility in Kingston, Ontario, was designed primarily for export, not for Canadian consumers. According to early planning documents, approximately 85 per cent of production was projected for export to China, with only a small fraction destined for the Canadian market. The facility, owned by Chinese dairy giant Feihe, began production in 2024 after receiving authorization from Health Canada and the Canadian Food Inspection Agency in March 2024.
Taxpayer Investment and Export Activity
Public records indicate at least $24 million in federal support was provided to the project, with additional assistance sought through Agriculture and Agri-Food Canada's Supply Management Processing Investment Fund. The documents also suggest exports have already occurred to markets including China and potentially the United States. Sylvain Charlebois, director of the Agri-Food Analytics Lab at Dalhousie University, noted that this raises questions about consistency: "The issue is consistency. Public confidence in any public policy depends on transparency."
Impact on Canadian Consumers
While Canada faces periodic baby formula shortages, parents have seen prices increase by more than 70 per cent over the past five years. The facility uses supply-managed milk, which is protected by Canada's dairy supply management system, yet its primary market is overseas. This contradicts the rationale often used to defend supply management: that it ensures a secure domestic food supply.
Political and Trade Implications
The situation comes as Canada prepares for another review of the Canada-United States-Mexico Agreement (CUSMA). American officials have criticized Canada's dairy policies for limiting market access and distorting trade. Charlebois argues that Ottawa must explain how a foreign-owned, export-oriented processor using supply-managed milk fits within the system's defense. Key unanswered questions include the total taxpayer investment, the volume of milk used for exports, and the destinations of those exports.
Supply management remains politically protected across party lines, but this case highlights a lack of transparency. Charlebois concluded: "This is really an accountability story. At the moment, Canadians only know part of the answer. That should concern us all."
