Ontario Agriculture

The network for agriculture in Ontario, Canada

Dairy farmers can sometimes get a bad reputation. Because of supply management, I'd agree that some farms can hang on longer than they would if they were open to the free market. The free market can be very good and eliminating the least efficient very quickly. Unfortunately - it can also eliminate some good farmers who just get mixed up in a market they can't control (just ask a hog farmer).

However - I think those least efficient dairy farmers are going to have to make improvements quickly or face some tough choices. In the recent dairy management school I took part in (if you missed me talking about that - click here), we got a chance to talk policy and economics with George McNaughton of the Dairy Farmers of Ontario. Right now, they are looking at having to make price reductions because a number of products are about to flood the market thanks to a low world dairy price and high Canadian dollar. Essentially what that means is that a combination of price and currency means processors in Canada can pay for the product as well as the import tariff, and get it cheaper than they can buy from local producers. (As a side note - can you guess which country poses the biggest threat? It is not the US. It is New Zealand) That means dairy farmers have only two choices. Sell at the cheaper price in order to compete, or dump the milk. It's not hard to figure out which one is more viable.

This isn't the first time dairy farmers have had to sell their milk for a lower price than what was set by the Canadian Dairy Commission, however it has only lasted a few weeks before the loonie cooled off, or world prices started to rise. However, talking with economists has me feeling that lower dairy prices could be sticking around longer than normal. Just take a look at TD's latest dollar outlook. It is pegging the loonie to sit between 1.02 and 1.05 for the next year.

I'm supportive of what the DFO is doing - even though they really don't have much of a choice here. All we as farmers can do is make sure the cows are milking as well as they can, and we make sure expenses are as low as they can be.

And how knows, maybe a lower price will result in a bit more demand - and a bit more quota for farmers to fill.

Do you agree? Or maybe have a different opinion on this altogether? Let me know in the comment section.

Views: 314

Comment

You need to be a member of Ontario Agriculture to add comments!

Join Ontario Agriculture

Comment by Wayne Black on May 22, 2010 at 4:58am
A lower price may not increase demand significantly. But it will eliminate many inefficient producers. It also would lower the price of certain 'barriers to entry' (land & quota costs). This may encourage beginning farmers or smaller producers back into the dairy sector - not for the money but for the love of taking care of the livestock. On the flip side, it may encourage remaining producers to get larger to gain better 'economies of scale'. A 1000 hd herd would become more common.

Agriculture Headlines from Farms.com Canada East News - click on title for full story

Sorghum can improve food security

As climate change continues to impact agricultural productivity worldwide, finding resilient and adaptable crops is crucial for long-term food security. Sorghum emerges as a shining solution – a crop that’s so hardy it’s almost a victim of its own success. It takes very little water and grows well in various soils. Offering numerous benefits that make it a reliable and sustainable option for regions facing climate challenges, sorghum has the potential to transform diets, support smallholder farmers and promote sustainable farming practices worldwide. The Sorghum United Foundation’s goal is to promote greater awareness of our grain among consumers and producers. We believe in the positive impacts of sorghum in both human and animal diets, renewable industry processes, and as a climate-smart option for farmers who value water conservation, soil health and carbon sequestration. Its adaptability and drought tolerance are two of the many reasons we believe sorghum is a wonderful tool for p

Healthy potato harvests surpass odds

Andy Diercks, a fourth-generation potato farmer from the small village of Coloma in central Wisconsin, is blunt about the difficult realities facing family-owned farms today. “There are days when the choices aren’t always good, and you’re making the least bad choice,” he said. “But we’ve survived well. I’m proud of what we do here.” For decades, Diercks’ family and farmers across the state have worked closely with vegetable researchers at the University of Wisconsin to ensure a healthy harvest, from the initial seed supply to disease prevention and management. Amanda Gevens, a UW-Division of Extension specialist and the department chair of plant pathology, knows all too well the high stakes for Wisconsin farms. She arrived at the university in July 2009 — the same month that a late blight epidemic hit the state for the first time in nearly a decade. Gevens had to learn how to relay critical information to farmers in a timely useful manner so that they could take action against the d

Farmers, artificial intelligence have key roles

It’s now 2025 and following intense rhetoric from governments, dairy farmers accept and understand they have key roles to play in reducing emissions produced by their herds. In fact, they’ve always accepted cows produce methane and that it can be harmful to the environment. And farmers know there are a number of management decisions they can take to help reduce greenhouse-gas production from livestock. As the payload of science intensifies, and new research becomes available, dairy farmers are willing to embrace the new knowledge and implement it on their farms. Their only hope is that other industries, outside of agriculture, also realize, admit and accept that they, too, have major responsibilities in helping countries reach their net-zero targets. Management decisions first steps Tinkering with feed, both in concentrate form and grass, can help reduce the overall amounts of gases being produced by cows. Cows produce methane when the feed they consume is digested in their gastroin

Polycrops: Challenges, Triumphs and Valuable Lessons from Beef Producers

Polycrop forage blends have become a popular tool among beef producers to increase soil health, manage grazing, improve cow performance and enhance resilience to changing weather conditions. However, as with any farming practice, the results can vary based on location, weather and management strategies. The practice of using polycrops, also known as cover crops, forage mixtures or cocktail crops, is intended to increase the diversity of plant species in a pasture. Increased plant diversity can enhance soil health, increase water infiltration, reduce fertilizer needs and provide higher quality forages for cattle. One of the objectives of the Living Lab Central Prairies has been growing polycrops on producer operations and evaluating both the long- and short-term impacts. The Living Labs program allows producers like Erika Stewart, John Griffin and Carmen Jackson to use polycrops on their operations, and they have encountered both successes and challenges with the practice. Their

Public comment period open for pullet and laying hen handling practice amendments

Canadians have until the end of May to provide feedback on hen and pullet handling

© 2025   Created by Darren Marsland.   Powered by

Badges  |  Report an Issue  |  Terms of Service