DECEMBER 2018 • COUNTRY LIFE IN BC
US milk offered for sale in Canada
Dairy industry hails opportunities
by PETER MITHAM VANCOUVER –
Renegotiation of the North America Free Trade agreement was still uncertain and Justin Trudeau touting his commitment to protecting supply management when Coca- Cola Co. announced a deal June 5 to introduce its Fairlife brand of ultrafiltered milk to Canada.
The deal allowed Coca-
Cola, through its Minute Maid division, to import Fairlife products from the US for 18 months until an $85 million processing plant completes in Peterborough in spring 2020. The milk is available in several grocers here in BC, including Save-On-Foods and Thriftys. The deal is now seen as the
thin-edge of the wedge of dairy products expected to flow north from the US after Ottawa conceded 3.9% of the domestic dairy market to Washington during NAFTA negotiations. Social media erupted first, and now awareness among the general public is spreading, prompting many consumers to check to make sure they’re not buying US milk and pledge to buy Canadian. Dairy farmers took
exception to the long-term trade concessions to the US, but letting Coca-Cola import US milk temporarily – labelled to assure consumers that it’s produced without growth hormones (like all milk sold in Canada) was seen as an
opportunity. “Dairy farmers are true
believers in innovation,” Dairy Farmers of Canada president Pierre Lampron said in June. “The building of a processing plant to produce this high- protein milk will create jobs for Canadians, adding to the 221,000 jobs supported by the dairy sector.”
The plant will employ 35 full-time workers when it opens, and will use Ontario milk – a fact Lampron credited to the high production standards on Canada’s dairy farms. However, the investment is less than what MDI Holdings Corp. – a joint venture between Abbotsford’s Vitalus Nutrition Inc. and Gay Lea Foods Co-operative Ltd. – has spent on two processing plants in BC and Manitoba designed to produce high- protein products from milk. The plant in Winnipeg alone cost $100 million, and employs 67 people. However, under USMCA,
MDI’s market opportunites have been capped. Fairlife is one of a number of ultrafiltered milks on store shelves. The milk is richer in protein and calcium thanks to the filtering out of sugars and other elements health- conscious urbanites dislike. A joint venture since 2012 with brand creator Select Milk Producers Inc., a dairy cooperative based in New Mexico, Fairlife logged sales of US$740 million in 2017, up from $350 million in 2016.
Volatile blend price hitting
home for dairy sector BC imports milk while producer payments fluctuate
by DAVID SCHMIDT ABBOTSFORD – August
brought an end to the need for the Western Milk Pool to skim milk, BC Milk Marketing Board director Corny Hertgers told Mainland Milk Producers at their fall meeting in Abbotsford, October 24. The past four years saw the pool skim about 89 million litres of milk because of the discrepancy between demand for butterfat and solids non-fat. Hertgers credited the new MDI Holdings Corp. drying plant in Manitoba for the turnaround, while noting the new plant has meant more milk movement and therefore higher transportation costs for the entire WMP.
Although the BCMMB increased BC producer
quotas another 2% in August and although producers have increased their production accordingly, the emergence of additional cheese processing in recent months means it’s still not enough to meet all of the province’s demand. “We are now moving a million litres of milk per week into BC,” Hertgers told producers.
Some of the demand is coming from Class 7, created in February 2017 as part of the National Ingredient Strategy. Class 7 offers processors certain milk products at world prices. While the NIS is meeting its objective of minimizing structural surplus and replacing diafiltered milk imports, Hertgers said it has made producers’ blend price “most
volatile” in recent months. Where it goes from here
is anyone’s guess, as the new USMCA trade agreement has put the future of Class 7 and the NIS in doubt.
Both BC Dairy Association
president Dave Taylor and MMP president Holger Schwichtenberg told individual producers to speak up about the negative impacts of the new agreement. “We need to keep
government accountable for what has happened to us,” Taylor said, stressing, “It’s not just up to Dairy Farmers of Canada or your leadership. You are all impacted.” Government “needs to
hear from you regularly and feel your pain,” Schwichtenberg told producers.
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