I don't analyze the situation in quite the same way, but as a neophyte to the dairy industry please tell me where my logic is wrong.  We have a huge trade deficit in dairy products with the USA which gives us the upper hand in any negotiation.  Blather about supply management aside, which is a deep and thorny problem, beset with various ideological underpinnings, and both pros and cons, the situation boils down to this.  We are in a price war with US dairy suppliers on 'skim milk' or 'ultra filtered' milk.  If the US decides to sanction us on our skim milk, we need only place a retaliatory tariff on their skim milk.  American dairies will lose much more business than we will, and conversely, Canadian dairies and farmers stand to gain that business back.  Perhaps my logic is too simple.  Please let me know.