How Canadian Dairy Farms Can Adjust to New Dairy Demand
Many changes occurred around the world as a result of the coronavirus pandemic. In Canada, while schools and businesses closed, consumers flocked to the supermarkets to buy essentials.
Perishable goods flew off the shelves, resulting in limits being placed on items like dairy and poultry. The standard distribution system schedule put in place for dairy products could not keep up with buyers’ increased shopping.
While retail demand from grocers skyrocketed, orders from the foodservice industry plummeted. This has resulted in unforeseen fluctuations in the dairy market.
Hotels, restaurants, schools and eateries are closed or operating at limited capacity. As a result, there is now an enormous surplus of milk that has nowhere to go. Farmers are not equipped with storage spaces to accommodate the excess supply. Unlike agriculture products like potatoes, milk has to be sold immediately or risk spoilage.
Cows will continue producing milk, regardless of fluctuations in the market. While farmers have the option to reduce the size of their herd or change diet or nutrition, these things could prove detrimental when the market stabilizes.
The Supply Management System
A supply management system controls production quotas and imports for Canadian dairy, chicken, turkey and eggs. It was established in the1970s to coordinate production and demand while simultaneously controlling imports. By operating under this method, prices are stabilized for both producers and consumers.
A national agency represents each industry, and they are in charge of setting production levels that match provincial demand. Farmers in each province are allocated production quotas that are meant to prevent surpluses or shortages.
The original quotas were based on consumer needs pre-pandemic. As a result of these unforeseen events, farmers must now adjust to the new Canadian dairy demand. Here are four main ways farmers can adapt to the changing times.
- Dump the Milk
Producers say that discarding raw milk is inevitable at this stage. Farmers are reporting that they have been asked to take turns dumping milk. Although they’re paid for it, the waste could amount to as much as 5 million litres every week.
This disposal method is unsustainable and should only be utilized while the market is above capacity. Cows must continue to be milked to keep them comfortable and healthy, and production must continue to ensure product availability in retail stores.
- Donate to Food Banks
Rather than dumping milk, some farmers have begun donating to food banks to support Canadians in need. While this is a positive form of dispersing the milk surplus, it has the potential to overwhelm food banks that may not have the storage capacity to support this influx.
Additionally, the raw milk provided from farmers must be processed, which complicates the standard donation process.
- Improve Operations
Dairy farmers should focus on improving operations to become more efficient and cost-effective. Many producers have begun investing in updated equipment and robotics to save time and money. Competition is set to increase as a result of import growth projected for the next decade. To maintain a market edge, operations should be improved and simplified wherever possible.
- Expand or Retire
In 2019, the Canadian federal government announced an aid package valued at $1.75 billion to compensate supply-managed dairy producers over an eight-year period. The Dairy Direct Payment Program is one part of this aid package and provides $345 million payments as compensation during 2019 and 2020.
The aid package was proposed as a result of import shifts. The Canadian government has opened part of its domestic market to foreign producers as part of several free-trade negotiations. To adapt to increased competition from foreign products, Canadian producers should plan to expand their operations or retire. Larger farms will be able to sustain demand while simultaneously upgrading their methods to be constantly improving.
Smaller producers may not be able to afford the necessary production updates to keep up with competitors.
These are unprecedented circumstances. As schools, businesses and restaurants reopen, dairy demand will increase. With indoor capacity requirements and shifts in consumer trends, consumption levels will undoubtedly continue to fluctuate.
While farmers should take steps to dispose of surplus responsibly, they should not halt production or decrease their operation size.
Read more from Emily Folk
I’m Emily Folk, and I grew up in a small town in Pennsylvania. Growing up I had a love of animals, and after countless marathons of watching Animal Planet documentaries, I developed a passion for ecology and conservation. You can read more of my work by clicking this link: Conservation Folks.
Olymel temporarily closes due to COVID-19
This is a news release from Olymel L.P.
Olymel announces the temporary closing of its Red Deer plant
Olymel management is announcing the temporary closing of its hog slaughtering, cutting and deboning plant in Red Deer, Alberta. Despite the testing protocols and sanitary measures already in place, as well as the close collaboration of Alberta Health Services to deal with a resurgence of positive cases of Covid-19 among plant employees, Olymel management believes that the conditions are no longer assembled to continue normal operations in a safe and efficient manner.
After notifying the union, Olymel management drew up an orderly temporary closing plan for an indefinite period. Over the next few days, plant management will mobilize the staff necessary to cease operations and complete the facility closure as soon as possible. The sanitary measures will continue to be in effect at the plant during the shutdown and Olymel management will be in contact with officials at Alberta Health Services to continue working closely with this organization.
Olymel sincerely hopes that all employees at the Red Deer plant who have tested positive for Covid-19 soon regain their health. The company will follow up with all employees to ensure their quarantine period is being respected and will strongly encourage all staff to get tested before returning to work. Olymel will also continue ongoing investigations to determine what may have caused such a large outbreak of Covid-19 cases since January 20.
Olymel management has also informed all hog suppliers of the Red Deer plant of the situation and has suspended all pending deliveries until further notice.
What’s going on in India?
In many places around the world, the global turmoil of 2020 has been deeply exacerbated by accompanying political violence. The United States, Belarus, and India are just a few locations that have faced growing levels of internal violence and discord as political protests have led to dangerous clashes between citizens and governing bodies.
In India, where the COVID-19 pandemic has been rampant throughout the course of 2020, citizens have also experienced ongoing political uncertainty as recent protests against the Narendra Modi government have been met with violence.
The upheaval began in August in response to the Modi government’s decision to pass 3 reform laws that would negatively impact local farmers in India’s agricultural sector. The Farmers Produce Trade and Commerce Bill, the Farmers Agreement of Price Assurance and Farm Services Bill, and the Essential Commodities Bill were passed on September 20, 2020. These laws, which were allegedly hurried through parliament with little to no regard for the concerns expressed by existing farming organizations in India, serve to ease corporate restrictions and remove regulations put in place to protect farmers and their product.
Although there does appear to be a consensus surrounding the need for reform in India’s agricultural sector, the laws passed by the Modi government have been condemned for failing to meet the requirements of a fair, legitimate transition. According to Time, “While the government says the new laws will “empower farmers”, unions say the rule changes are not policies they have asked for. Instead they fear that instead of trying to help farmers, the government is opening the door to big corporations who may eventually force them off their land and out of their business.”
Peaceful protests then emerged as a public response to the actions of the Modi government. The protests, which originated in Punjab and Haryana as a collaborative movement among Indian farmers, have since mobilized tens of thousands of farmers and supporters from across the country to march on the Indian capital. The protestors flooded New Delhi’s main entry points, where they have since set up camps to maintain their position and stand firmly for their cause, requesting the repeal of the 3 reform bills.
Despite the peaceful nature of the protests, where many of the participants are senior members of the community, since September they have been increasingly met with violence from the state. “Protestors have been met with water cannons on some of the coldest winter days Delhi has experienced,” Global News reported in December, “along with tear gas, concrete barricades, and some were even beaten with batons.” As a result of state-mandated violence and harsh outdoor conditions in Delhi, a total of 65 deaths were reported between November 26, 2020 and January 3, 2021 (1).
Individuals and organizations around the world have since come forward to stand in solidarity with Indian farmers and condemn the acts of violence being perpetrated against them by military and law enforcement.
On Tuesday, January 12, 2021, the Indian Supreme Court announced it was “halting the market-friendly laws until a committee of experts, appointed by the court, could consult with government officials and protesting farmers to try to find a solution to the dispute” (2). However, protestors have expressed initial skepticism following this announcement, and intend to maintain their positions within the protest camps until the laws are repealed.
“It’s cold and it’s hard to arrange water every morning for a bath,” says Shabek Singh, a member of the protests who remains camped in one of the established tent cities, “but we’re not going anywhere. We will make this our temple” (3).
For more stories, visit Todayville Calgary.
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