Dairy farmers aim to pool milk prices nationally

Thursday, July 21, 2011

by SUSAN MANN

Canada’s dairy industry will try once again to establish a national milk pool.

The Canadian Milk Supply Management Committee decided at its meeting Wednesday in Ottawa that provincial representatives would begin negotiating an all-milk pool, says John Core, Canadian Dairy Commission CEO.

The provincial representatives to the negotiating committee haven’t been named yet, says Core, noting the committee’s first meeting is at the beginning of September. “Over the next few weeks people will send us the names of the people who are going to sit at the table for the negotiations.”

As for the negotiating committee chair, provincial representatives asked that there be an independent person. The vice-chairs will be Gilles Froment of the Canadian Dairy Commission and Rick Phillips of Dairy Farmers of Canada. Both are senior staff members and they’re responsible for the technical aspects of the discussions.

Core may become the chair of the negotiating committee as his term as CEO of the commission expires in October and he won’t be returning. He has been the commission’s chief executive for the past nine years.

The goal is to have a progress report in February 2012 to see where things are at and how negotiations should proceed, Core says.

This is the second time the industry is trying to negotiate a national milk pool. In the 1990s, industry representatives negotiated to set up the all-milk pool but ended up establishing two pools – one in Western Canada and one in the East, known as the P5 All-Milk Pooling Agreement but now called the Agreement on the Eastern Canadian Milk Pooling after the agreement was updated and renewed last year. Ontario is in the eastern milk pool along with Quebec, Nova Scotia, New Brunswick and Prince Edward Island. As part of the pooling agreement, the provinces share revenue from industrial and fluid markets and work cooperatively on other areas of mutual interest.

Core, who was chair of Dairy Farmers of Ontario when the industry tried to negotiate an all-milk pooling agreement in the 1990s, says what’s different this time is the industry has experience operating the western and eastern milk pools plus sharing the markets and revenues within those two pools. “Before we were really starting from scratch and didn’t have much experience at this.”

In addition, “there’s a recognition the risks continue to be there as the reasons for having a single pool,” he says.

But whether industry representatives can nail down an agreement this time remains to be seen. “That’s what the negotiations will determine,” Core says. “I think there’s a willingness now to sit down and have another go at it with everybody’s experience with the pools themselves.” BF