Why Does Canada Have a Maple-Syrup Cartel?

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Over a one-year period during 2011 and ’12, some 6 million gallons of maple syrup — about $18 million worth — were stolen from the “strategic maple syrup reserve” controlled by the Federation of Quebec Maple Syrup Producers (FPAQ). The cartel’s syrup was taken from a St.-Louis-de-Blandford warehouse, which some clever thieves had access to because they just so happened to be renting another section of the same storage facility. Last week, three men were arrested in connection with the heist.

(MORE: Sticky Situation: $30 Million in Maple Syrup Stolen from Canada’s Strategic Syrup Reserve)

It may seem bizarre that Canada has a maple-syrup cartel at all. But think of it this way: Quebec, which produces about 77% of the world’s maple syrup, is the Saudi Arabia of the sweet, sticky stuff, and the FPAQ is its OPEC. The stated goal of the cartel, in this case, is keeping prices relatively stable.

The problem with maple syrup is that the natural supply of it varies dramatically from year to year. “It’s highly dependent on the weather,” explains Pascal Thériault, an agricultural economist at McGill University in Montreal.

(MORE: A Brief History of Maple Syrup)

“The maple trees need optimal climate conditions — cold nights, temperate days — to produce the right sap,” explained a recent article in the Washington Post. “That doesn’t always happen, and production varies sharply each spring.”

Demand is also irregular, added the Post: “During recessions, many families cut way back on syrup purchases, since it’s not exactly essential.”

So since 1989, the FPAQ has modulated supply to keep prices stable, setting aside maple syrup in good years and releasing it in bad ones. Thériault says relatively little maple syrup was produced from 2005 through ’08. But from 2009 through ’12, the syrup flowed fast and sweet, filling warehouse with reserves and setting the stage for the maple-syrup heist.

(MORE: Top 10 Crime Stories of 2012)

Does the maple-syrup reserve keep prices artificially high? In good years, yes. A supply-management system like the one in Quebec will keep prices stable no matter what supply is like. But when Canada isn’t producing as much maple syrup, the cartel kept prices lower than would otherwise be the case.

The system seems to have helped producers, who would no doubt be the ones most heavily affected without the reserve, says Thériault. It’s a different story for consumers, who don’t get to take advantage of years of syrup surplus. Considering the stranglehold Quebec has on the global market, that’s not likely to change anytime soon.

MORE: Syrup Shortage: Warm Weather Has Led to ‘Yucky’ Maple Syrup

81 comments
cdnkellyb
cdnkellyb

@Purplishink I saw this, isn't it crazy!

dreapadoirtas
dreapadoirtas

@socmobem @emcrit @jcillo I see your maple syrup and I raise you mussels, abalone, scallops, crayfish, cherries, apples....

StormReverie
StormReverie

Because Canada produces about 80% of the world’s supply of maple syrup. The United States produces the remaining 20% with Vermont controlling approximately 35% of all U.S. maple syrup production or distribution, or roughly 7% of the world’s maple supply.

pbanik
pbanik

@Lamhot_Htbarat I don't have pancakes, or waffles very often, so it doesn't affect me as it would people who have it more.

lilmiss2000
lilmiss2000

@TIME @timebusiness B/c we is gangsta ass mothas..

OzarkGranny
OzarkGranny

Florida has the Orange Juice Cartel, Mexico has the drug cartel, AARP has the senior cartel, could it be that people are inclined to band together to promote their economic self-interest?

MarkDavies
MarkDavies

I grew up on the Canadian Maple Syrup, being across the water from Canada. I love the stuff. I won't let my kids eat anything but the real stuff. No corn syrup garbage! We get ours at BJ's for about $12/US. We don't eat it often so it lasts us quite a while.

TomatoPasted
TomatoPasted

@CNN & @TIME publish stories on maple syrup while Canadian First Nations Chief Teresa Spence is on a hunger strike. Insulting. #IdleNoMore.

jldub
jldub

It's pounds of maple syrup, not gallons.

edvanluit
edvanluit

@TIME Because here in Canada the saps that are worth gold.

shordavs
shordavs

@TIME @timebusiness Europe has pancakes and waffles tied up Canada was left with maple syrup as a stereotype. http://t.co/f0tB7i6x

StmacR
StmacR

@TIME @timebusiness it's a sticky business best leafed alone

cambo
cambo

There is another factor involved in maple syrup pricing.  The Canadian Government through the Canadian Forces pays a high fixed price to Quebec Producers.  This is done for a few reasons.  It is a way to funnel money to Quebec from other taxpayers, it was thought to calm separatist fools, but most of them have never been in the forest, except to avoid conscription, and in a strange way, allows other producers in Ontario to point to the Quebec price to get what they want.  Even Costco is not immune to this price fixing.  They sell maple syrup in Ontario for 12 dollars a litre, so maybe not as much absolute profit, but still a high price.  I just go to a friend's farm and pay him cash, and that cash sale which never goes across the tax ledger is where the real savings can be found.

Kabs Kubs
Kabs Kubs

darn canadian outlaws..they're sure havin a sweet time by now..

daniel_guibord
daniel_guibord

I’m a Canadian, and lived in Canada most of my life. Canada is the country of cartels; e.g., cellular services, Internet services, imported bicycles, cheese (the Quebec government granted an official price fixing status to milk producers), gasoline, universities, you name it.

Canada is one of the, if not the most non-competitive country in the world concerning consumer products, because local governments purposely reduced competition to save the jobs of some Canadian workers, creating severe market distortions. The Canadian Bureau of Competition is a joke.

zhochaka
zhochaka

Isn't this strategic reserve doing much the same as  a speculator: buying when the supply is high, selling when the supply is low?

skytag
skytag

"some 6 million gallons of maple syrup – about $18 million worth"

Where can I buy a gallon of maple syrup for $3?

Purplishink
Purplishink

@cdnkellyb They call it a cartel. :) You guys are so nice, your drug cartel is all about maple syrup! ;)

socmobem
socmobem

@dreapadoirtas @emcrit @jcillo Maple syrup IVDU = DKA + syrup embolus. #canadianER

socmobem
socmobem

@dreapadoirtas @emcrit @jcillo Canada has those too, plus lots of maple syrup related violence/pathology!

gamma142
gamma142

I'm guessing maybe that's the raw value as it resides in the warehouse. Markup doesn't likely happen until the syrup is transported, passed through the hands of those in charge of branding and then ultimately ends up the retail environment, where you end up paying in excess of $60 to $70 per gallon. The money from the increased price goes to pay for the related delivery costs, i.e., fuel and driver wages, and other expenses along the way. For example, if you could pump gas directly into your car right at the refinery, that gas would probably cost you .35 cents per gallon.

cdnkellyb
cdnkellyb

@Purplishink what's with all the glitter???

ETtube
ETtube

@socmobem @dreapadoirtas @emcrit @jcillo Don't forget back bacon bezoars and Tim Hortons coffee w/d needing EMCrit-sized diazepam doses.

pbanik
pbanik

@Lamhot_Htbarat Would it affect you that much? How often do you eat hotcakes/pancakes and/or waffles? I don't use maple syrup that often.

dbfOhio
dbfOhio

.35 cents a gallon!!  I think you may need some math classes.  A bbl of oil is 42 gallons.  So if the current price is $85/bbl, then a raw gallon of unrefined crude oil is about $2 per gallon.  People really need to get educated about the oil industry, because many people probably believe something as silly as .35 censt a gallon at the refinery.

Purplishink
Purplishink

@cdnkellyb I dunno! I can't figure it out! I'm sparkly now. It's gold dust glitter & I can't remember when I could have encountered it. Hmm.

pbanik
pbanik

@Lamhot_Htbarat I guess you will have to wait for that until you're in a country where it snows.

pbanik
pbanik

@Lamhot_Htbarat I see...does it snow at all in your country? I'm wondering because some countries on that continent has snow sometimes.

Lamhot_Htbarat
Lamhot_Htbarat

@pbanik it's pretty HOT here.. Dreaming about white christmas..

pbanik
pbanik

@Lamhot_Htbarat Yes, it's pretty cold this time of year usually, and I think Rafael Nadal has a stomach virus, which is why he pulled out.

Lamhot_Htbarat
Lamhot_Htbarat

@pbanik Rafael Nadal has been confirmed that he pulls out of the Australian Open this January..

Lamhot_Htbarat
Lamhot_Htbarat

@pbanik yeah I saw from my world's clock.. Under 0 celcius..

pbanik
pbanik

@Lamhot_Htbarat Since the weather is colder at this time of the year in the northern hemisphere, I tend to prefer eating hot breakfasts.

Lamhot_Htbarat
Lamhot_Htbarat

@pbanik all right.. I would definitely try it at home..

pbanik
pbanik

@Lamhot_Htbarat You could just make it, or buy it frozen. It would be probably cheaper that way.

pbanik
pbanik

@Lamhot_Htbarat Ok. I usually have cereal or toast when I have breakfast. When I do have pancakes or waffles, it's usually on the weekend.

Lamhot_Htbarat
Lamhot_Htbarat

@pbanik sometimes.. When I want to eat that, I would go to bakery store..

dbfOhio
dbfOhio

Egypt, like many poor nations, subsidizes fuel costs for its citizens.

My apologies to Gamma142.  I get quite annoyed with Americans who seem to see conspiracies around every corner without making any effort to understand the basics of what they are talking about.

gamma142
gamma142

Well, you don't need to be arrogant about it. Math and economics were my weakest
subjects and I was not attempting to quote an actual dollar amount for gas
production, delivery and sale, but I do see where my wording was off
and could have been read that way. I was simply drawing a parallel in reply
to the comment regarding the value of maple syrup being so much lower at the
warehouse vs. the store. I may stand corrected with my example, but I think
calling me silly is out of line, because that would be just as bad as
my highlighting the fact that you may need a Composition Lesson, as
you mispelled cents, plus when you type .35 you don't follow that with the word
cents, which is known as a redundancy in grammar, but I wouldn't point that out
because that would be just plain silly!

JohnWalsh
JohnWalsh

@dbfOhio Actually, I live in Egypt and gas cost $0.30 - $0.33 per litre which equals about $1.20 - $1.30 per gallon.  How's that for math.