Search
Better Farming OntarioBetter PorkBetter Farming Prairies

Better Farming Ontario Featured Articles

Better Farming Ontario magazine is published 11 times per year. After each edition is published, we share featured articles online.


Canadian dairy exports decline in face of sharp decline in world prices UPDATED

Wednesday, February 3, 2016

by SUSAN MANN

The Canadian Dairy Commission’s export sales revenue nosedived last year compared to the previous dairy year due to a sharp decline in world dairy product prices, delegates at last month’s commission annual meeting were told.

Plunging world prices for skim milk powder starting in 2014 also lowered the boom on the quantity of powder the Canadian supply-managed sector can export. The World Trade Organization has tied the amount of powder the Canadian industry can export into world prices.

The commission exports the powder on the sector’s behalf. The powder is considered to be a solids non fat product. In the milk industry, solids non fats production exceeds domestic demand in order to generate enough of milk’s other primary product, butter fat, for the domestic market.

For the 2014/15 dairy year (Aug. 1, 2014 to July 31, 2015), the commission sold about 12,000 tonnes of skim milk powder, a 43 per cent decrease from the 21,000 tonnes of powder it sold in the 2013/14 dairy year.

In 2014/15, the commission had total export sales of $33.8 million, which is 64 per cent less than in 2013/14 when export sales were at $92.8 million.

The commission had a loss of $590,000 in its export activities for 2014/15, according to a written presentation provided by the commission. The commission buys products destined for export at “prices that reflect prevailing world market conditions, hoping to break even over the course of the dairy year. Because these markets are unpredictable, we sometimes finish the year with minimal gains or losses, which was the case in 2014/15.”

In 2013/14, the commission’s loss in export activities was $220,000 on the total export sales of $33.8 million.

The commission buys surplus solids non fat and exports what it can. The balance goes into the animal feed market, which typically generates much lower returns for the product.

"If we export less that means there's more going into the animal feed market and that has a reduction impact on the blend" price producers across Canada get, says Chantal Paul, commission spokesperson.

UPDATE Thurs. Feb. 4, 2016 — Paul says export losses are added to the commission’s profit from domestic operations. In 2014-2015 the loss dropped the domestic operations gross profit to $23.3 million from $23.9 million.

“Dairy farmers fund these operations,” she adds in a Feb. 4 email. “This means that they are responsible for any loss and that any profit is reimbursed to them through the pools.” END OF UPDATE

The world price for skim milk powder is low now because China over-purchased skim milk powder and has a lot of the product in stock. “They used to buy a lot,” Paul says. “They don’t buy as much as they used to. They were buying mostly from New Zealand.”

The Russian embargo on European products means fewer sales of European skim milk powder to Russia “so that’s glutting the market, as well,” she notes.

The commission’s annual report hasn’t been tabled in the House of Commons yet because of the federal election in the fall. But all of the financial information presented at the meeting was audited and accepted by the Office of the Auditor General, delegates were told.

The commission was established in 1966 to coordinate federal and provincial dairy policies and the organization is also a key facilitator in the Canadian dairy sector. BF

Current Issue

November 2024

Better Farming Magazine

Farms.com Breaking News

Navigating Financial Literacy for Women in Ag

Monday, November 4, 2024

By Deanna Ciaccia In today’s evolving agricultural landscape, financial literacy is crucial for success, particularly for women who are increasingly taking leadership roles in the agriculture sector. According to a recent article from FNBO (First National Bank of Omaha),... Read this article online

Ontario Pork Congress Annual Meeting report

Friday, November 1, 2024

The Ontario Pork Congress was held on October 22, 2024, at the Arden Park Hotel in Stratford, Ontario, with over 35 people attending. At the event, the association revealed the winner of its —Tara Terpstra, a Huron County pork producer who is currently Chair of Ontario Pork. The... Read this article online

Massey Ferguson introduces six new tractors

Friday, November 1, 2024

Massey Ferguson has debuted its new of tractors, what the company calls a line-up of versatile and powerful machines designed to meet the needs of modern farmers. This series includes six new models, each tailored to different farming requirements and preferences. MF... Read this article online

Bills C-244 and C-294 have been adopted

Friday, November 1, 2024

On October 31, without much ado, and were adopted by the Canadian Parliament and are poised to become law. These bills amend the and represent a historic step forward in the right-to-repair movement, especially for Canadian farmers. allows consumers and businesses to... Read this article online

BF logo

It's farming. And it's better.

 

a Farms.com Company

Subscriptions

Subscriber inquiries, change of address, or USA and international orders, please email: subscriptions@betterfarming.com or call 888-248-4893 x 281.


Article Ideas & Media Releases

Have a story idea or media release? If you want coverage of an ag issue, trend, or company news, please email us.

Follow us on Social Media

 

Sign up to a Farms.com Newsletter

 

DisclaimerPrivacy Policy2024 ©AgMedia Inc. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Back To Top