Quota rights group strikes out again

Thursday, December 17, 2009

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by BETTER FARMING STAFF

The Ontario Quota Rights Organization has lost its attempt to have a Dairy Farmers of Ontario policy on quota transfers dating back to 2006 rescinded.

The decision to uphold the transfer policy was released today by the Ontario Agriculture, Food and Rural Affairs Appeal Tribunal. The Quota Rights Organization, an ad hoc organization made up of current and former milk producers had sought nearly $16 million in compensation from Dairy Farmers of Ontario for losses claimed by members some of whom, the Tribunal decision noted, remained in the industry.

The Tribunal hearing was held over three days in early February in Ottawa, and was finished in Guelph

Quota rights members argued that Dairy Farmers of Ontario did not consult with producers before changing its policies. The Tribunal found Dairy Farmers of Ontario did consult with the industry. Concerns about quota values were raised in Spring Regional  Meetings “as early as 2003” and a paper suggesting that a 15 per cent transfer assessment on quota be reintroduced was discussed at a fall policy conference in 2005.

“The Tribunal finds that it is unlikely there would be any substantial difference in the impact on quota prices by a sudden implementation as opposed to giving advance notice,” the Tribunal decision says.

“Had DFO given notice of the policy, the supply of quota would also likely have exceeded the demand, depressing the exchange clearing price. Thus, it is possible that sellers may have received a price lower than the potential $25,500, which was the maximum return a seller would receive with the application of the policy. Thus, the Tribunal will not rescind the policy based on the lack of a notification period.”

The Tribunal found that the policy aiming to control quota prices appears to be successful. “Expert testimony and evidence demonstrate that since the introduction of this policy quota prices have fluctuated slightly but in general have stabilized.”

Neither DFO nor Donald Good responded to requests for an interview. BF