The Politics of Cheese: you may pay more for delivery pizza in 2014

Unbeknownst to most Canadians, there’s been a quiet war brewing in this country over the price of pizza cheese. On one side, Pizza Pizza Ltd.; on the other, 12,500 very angry dairy farmers.

Under Canada’s controversial supply management system, cheese imports from the U.S. are usually subjected to an almost 250 per cent tariff. For the past year, however, Pizza Pizza and other fast-food pizza companies have been bringing cheap mozzarella across the border tax-free. They’ve done so by legally exploiting a loophole that exempted pre-made “topping kits” from the regular tax. Provided the cheese was packaged with a few slices of pepperoni, it technically fell under the Canadian Border Service Agency’s definition of “food preparations,” and was allowed to enter the country duty-free. According to enraged dairy lobbyists, these sneaky imports have grabbed up to 12 per cent of the fresh pizza cheese market in Canada.

That stopped on November 29, when the government changed the definition of “food preparations” and effectively plugged the regulatory hole.

Unsurprisingly, members of the food service biz aren’t terribly pleased with the decision. Garth Whyte, president of the Restaurant and Foodservices Association, told the Globe and Mail that he sees the move as a backhanded attempt to make nice with dairy farmers, who are still pouting over a possibly damaging free trade deal that was negotiated with the European Union earlier this year. Whatever the reason for the change, the result is that pizza companies will now be forced to buy their cheese at home, where it sells for about 30 per cent more than in the U.S.—a price that may well be passed on to the pizza-eating public.