Dairy Farmers of Canada ingredient strategy won't affect Ontario's, says DFO spokesman

Wednesday, July 13, 2016

by SUSAN MANN

Dairy Farmers of Ontario’s board will discuss a national agreement in principle at its meeting next week that includes the creation of an ingredient strategy for all of Canada.

Negotiators with dairy farmer and processor associations concluded the agreement this week after negotiating for almost a year. Details of the national plan will be made public after final ratification by all of the country’s provincial boards, with implementation slated for Sept. 1, according to a Dairy Farmers of Canada press release.

In April, Ontario introduced its own ingredient strategy, and Graham Lloyd, Dairy Farmers of Ontario general counsel and communications director, says there are no plans to shelve it now that a national one is on the horizon. The provincial strategy is work well, he says. “We expect it to continue to work as it is. We’ll look to harmonize with the national level.”

Ontario’s strategy involves processors being able to buy dairy ingredients, such as skim milk solids, at world prices. Ontario’s class for the dairy ingredients is Class 6.

In Canada, raw milk sold to processors is classified and priced based on end use. The classes range from fluid milks and creams (Class 1) to milk used for further processing (Class 5).  So far, Ontario is the only province with a Class 6 for dairy ingredients.

However, at the national level the dairy industry modified an existing class, Class 4 (m) to enable processors across Canada to buy dry and liquid milk protein concentrates and liquid skim milk at world prices. The temporary program began May 1 and continues until July 31.

Lloyd says he couldn’t comment of whether there are additional elements to the national agreement than just the ingredient strategy.

Previously dairy industry leaders had been talking about an eight-element plan, including a national ingredient strategy, to ensure the industry’s future stability and profitability. Some of the proposals previously included in the plan included: a new end-use billing system for processors to prevent the cannibalization of existing solids-not-fat usage in cheese and yogurt and modifications to the Canadian Dairy Commission’s surplus removal program. BF