26


Out of the hands of BC farmers


by GRANTWARKENTIN Dairy farming in BC is no longer in the hands of local


producers. It’s controlled by Canadian dairy companies in Quebec, who might be the only ones capable of navigating the dangerous waters of global agri-business while ensuring Canadian producers still have something to sell. The biggest threats to Canadian dairy today are mostly the same as they were 100 years ago – foreign dairy imports, low prices, and lack of collective buying power. The history of dairy in BC has been a struggle to overcome those threats. The Fraser Valley Milk Producers Cooperative


Association was created by farmers in 1913 to protect the price of local milk. They were concerned about cheap American dairy products flooding north and putting BC farmers out of business. So were many politicians, who eventually agreed to the Sumas Lake Reclamation Project, which drained 33,000 acres of land between Abbotsford and Chilliwack during the 1920s to create new farmland for dairy producers. The association became Dairyland in 1943 and built a modern milk processing facility in Burnaby in 1964. Saputo recently agreed to sell the plant when it opens a new facility in Port Coquitlam. During the 1970s and 1980s, BC dairy producers


created household brand names such as Pacific milk powder and Armstrong cheese. They established BC dairy farmers as Canadian pioneers in agriculture, with some of the most modern facilities in Canada and best practices in processing that have since been adopted elsewhere. But success comes with a price and after a frenzy of


mergers, sales, acquisitions, upgrades and plant closures in the 1990s, by the mid 2000s, most BC dairy production was in the hands of Quebec dairy companies, who repositioned BC brands to deal with new 21st-century economic realities. Pacific now mostly exports dried milk powder and other


products to China. Armstrong cheese hasn’t been made in Armstrong since the North Okanagan plant was closed in 2003. And the future of Comox Valley Islander milk, made in the Comox Valley until last month, remains uncertain.


PLANT closure


the province anymore,” he said. “They’ve been part of the community for decades. For those individuals that’s going to be significant to try and make that up.” Most of the plant’s 26


unionized employees have taken buyout packages, and seven will take positions at Saputo’s Burnaby plant, which serves most of Western Canada. The drivers


who pick up and deliver milk from Comox Valley farms won’t be affected immediately, nor will farmers, but their costs for pickup and hauling milk may change after the plant closure.


Operational efficiencies The Courtenay plant


closure follows the same template as other recent Saputo plant closures across Canada. In each case, the company gave the same reason for the closure. “At Saputo, the decision to


close any plant is never one taken lightly. This announcement is part of our ongoing analysis of our overall activities and the


implementation of measures aimed at improving our operational efficiency,” a company statement on the closure said. “We consider our employees to be by far our most important asset and the employees affected by the Courtenay plant closure will be offered the possibility to transfer to other functions as positions become available.” Courtenay staff going to Burnaby may be in for a


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bumpy ride in the next few years. That facility is also scheduled to be shut down to “improve


COUNTRY LIFE IN BC • APRIL 2019 nfrom page 24


Mexico. On February 22, Saputo announced its biggest deal yet. The company is spending $1.7 billion to purchase Dairy Crest, a milk producer and processor in the UK. “The transaction would enable Saputo to expand its international presence and enter the UK market by acquiring and investing in a well- established and successful industry player with a solid asset base and an experienced


management team.


Dairy Crest is an attractive platform which fits with Saputo's growth strategy,” the company said in a news release.


Smaller plants such as the


operational efficiencies.” However, a new, $240 million plant is being developed in Port Coquitlam. It’s expected to be in operation sometime in 2021. A deal is in place to sell the site in Burnaby for $218 million.


The new plant will take


over serving Western Canadian markets while the company repositions itself to take advantage of market opportunities outside Canada, said Saputo CEO Lino Saputo in a conference call with investors in June 2018. It highlights ambitions far


larger than a handful of dairy farmers on Vancouver Island. In the last six months, Saputo has been busy “improving operational efficiencies,” buying an Ontario dairy for $100 million, selling a $240 million dairy plant in Australia, and purchasing a $113 million dairy operation in the US with distribution channels into


one in Courtenay are fast becoming footnotes as food goes global. BC’s dairy industry, which


started as many small independent, farmer-led co- operatives, is now dominated by Quebec-based Saputo and Agropur (also a co-operative). Almost every single dairy brand on BC grocery store shelves, from Olympic yogurt to Lucerne milk to Armstrong cheese and Pacific skim milk powder, exists now to satisfy global stakeholders, not support small-town farmers in rural BC. Vancouver Island dairy farmers are still farming, regardless of who gets their milk to market. There are 39 producers on all of Vancouver Island. They produce 57 million litres per year, including 17 million from 13 producers north of Nanaimo. There are 272 dairy producers in BC.


308 St. Laurent Avenue Quesnel, B.C. V2J 5A3


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