Supply Management IV: will new NAFTA be our nemesis? 

Some of you have been asking for our thoughts on the latest news coming out of the NAFTA negotiations. And honestly? I’ve been too disheartened to even write about it. We’re scared. Scared about our futures, scared about our children’s futures. As relatively new additions to the dairy industry – we’ve been dairying for less than 15 years, only 6.5 years on our own – we carry a massive debt load. That’s all fine and dandy under the stability of our supply management system, and it should be paid off before our children would potentially take over the reins of the family farm. However, should that stability vanish, as the latest US demands for the abolishment of our entire system would entail, our farm would very possibly cease to exist. 

And why? Our system ensures a stable, fair price for farmers. It also has meant that consumers – and we’re consumers too! – have paid a competitive, fair price for dairy products in the grocery stores. It has allowed Canadian farmers to develop a top notch program that ensures that our dairy farms are held to the highest milk quality, food safety, and animal welfare standards in the world. Our system has helped hundreds of young and not-so-young dairymen and women get a leg up into the industry through various provincial new entrant programs. There are so many benefits to our system! Is it perfect? No! But it’s always changing and adapting to new situations. And quite frankly, it’s the best system out there. Around the world, dairy farmers are struggling to make ends meet. In New Zealand, Australia, the UK, Europe, and the USA dairy farmers are exiting the industry in droves, no longer able to keep their farms afloat after sustained low global milk prices. 

So why attack our industry? It doesn’t make sense to me. The world is awash in a glut of milk. Farmers around the world have been producing more and more milk, all just trying to make ends meet. But now there’s a huge over-supply. Canada’s market look mighty attractive; a good place to dump that excess. But that won’t solve the problem! With only 30 million consumers, 10x LESS than the US, our market would quickly be saturated with this foreign milk, and the problem would still be there. Except now, our small Canadian family farms would be forced out of business, unable to compete with the glut of milk pouring over the border at abnormally low prices. Our complete rural fabric would be torn apart. It’s not just the farmers who would suffer; it would be the feed companies, the veterinarians, the dairy supply companies. In short, it would mean large scale devastation of many rural communities. Instead, these governments eyeing up and demanding the end of our system should fix their problems at home. Manage your supply. There’s no need to over-produce; it’s just plain wasteful and it’s detrimental to the global dairy industry. When supply and demand are balanced, we all win: farmers, consumers, governments, and national economies. 

We’ll be watching the next NAFTA negotiation rounds with bated breath. We are most definitely thankful that so far our government has been vocal about their determination to protect supply management, and we hope and pray that these words will be reflected in their actions at the negotiating table. To our supporters: thank you. Thank you for your moral support. And thank you for continuing to support your local dairy farms with your purchasing habits. We wouldn’t be farming and living this dairy life, caring for our cows with dedication without you behind us! 

For now, we continue on. Our kids still follow us around the barns, helping out when they so wish, learning to do by doing. Will this knowledge and these skills ever be put to use one day? Will they ever follow their dreams to be just like mom and dad? I don’t know. Time will tell. 

British Columbia is burning. Please pray!

A state of emergency has been declared for our beautiful home province of British Columbia. A prolonged period of dry and very hot weather has brought tinder-dry conditions to much of the province, prompting officials to raise the wildfire risk to extreme in many areas and to ban all outdoor burning, including campfires and even tiki torches. But hundreds of dry lightning strikes over the past two days led to the sparking of 138 (!!) new wildfires yesterday. Several of these fires are “interface fires”, ie a threat to homes, communities, infrastructure, etc. Thousands have been forced to flee their homes and farms and ranches in the fires’ paths. Highways are closed due to the fires and smoke. Homes have burned. These fires are vigorous, unpredictable, and voracious, destroying everything in their paths. 

Yesterday, we heard that our childhood friend had been forced from her ranch that was directly in one of the fire’s paths. They chased their cows into a swampy area and left their home with their children and dogs, with nothing to do but pray that their home and animals would escape the raging inferno. They posted photos and video clips of the fire approaching their ranch as they left. Imagine their profound joy and thankfulness as they were able to return home this morning to their house intact, their cattle alive. Such a blessing!

Contrast that joy with the devastation felt by our fellow dairy farmers who lost their entire farm in another wildfire yesterday afternoon. They were able to rescue nearly all of the cows, but their home, barns, crops, even their irrigation equipment, is all gone, destroyed by the greedy blaze. Devastating. Unimaginable. There really are no words to adequately describe what they’re going through.

There is another fire burning in our vicinity, up on the east side of Harrison Lake. That fire too is not contained, but as of yet is not threatening any communities or homes. It’s far enough away with enough mountains between us as a barrier that it is not a worry, but it definitely is unsettling to think that our home and farm too could be lost in an instant to a blaze like that one.

Please, friends, keep our province, our communities, our farmers and ranchers in your prayers. Pray too for the safety of the brave men and women battling these blazes. Thank you.

Supply Management: Good for farmers, good for consumers, good for Canada. Hands off, Bernier!

Okay friends, we’re coming down to the wire here in the Conservative leadership race. With all of the uproar in the last week with President Trump taking aim at our Canadian dairy industry, we can’t forget that we also have domestic challenges facing our industry. Just this morning, Canadian businessman and Conservative leadership candidate Kevin O’ Leary, one of the polling front-runners in the leadership race, pulled his name from the race and threw his support behind Maxime Bernier. As you know from our previous posts, Maxime Bernier has pledged to end supply management if he is elected leader of the Conservative Party of Canada, and Mr. O’ Leary had admitted that he would use supply management as a bargaining tool in future trade negotiations. Both he and Mr. O’ Leary are leading in the polls, so as you can understand, this bolstering of Bernier’s campaign is rather unsettling.

Supply management keeps Canadian dairy, poultry and egg farms vibrant, viable, and an integral part of our national fabric, from both a social and economic perspective. Without supply management and our border tarriffs, our family farms would have a very hard time competing with the glut of excess milk currently flooding the world dairy market. We know that our system that ensures a fair return for farmers is the envy of dairy farmers around the world, and we personally have received many messages from farmers south of the Canadian – US border who long for a system like ours that would allow their farms to remain viable in this turbulent time for the dairy market.

So the benefits for farmers are obvious, but what about for our consumers? Mr. Bernier alleges that if supply management were scrapped, consumers would pay much less for their dairy; he’s even claimed that Canadian consumers pay twice the amount they should pay for their dairy products. Unfortunately, Mr. Bernier does not have his facts straight. Check out the photos I’ve posted below.

 

 

 

 

 

 

Both research from an accredited research firm and very current anecdotal evidence from a fellow dairy farmer doing her own research prove that Canadians pay a very competitive price for their eggs and dairy. In fact, if we compare apples to apples, Canadian pay LESS for dairy compared to the same dairy products in the US (all Canadian milk is produced without the use of artificial growth hormones). Now, Mr. Bernier, either you’ve been misinformed, or you’re deliberately trying to garner support from unsuspecting Canadians by quoting “alternative facts”.  Judging by the number of times dairy farmers and industry representatives have presented the correct information to you, I’m leaning towards the latter assumption. That doesn’t say much for your integrity, and, in my opinion, throws your entire campaign and character into question. Definitely not the type of individual I want to see at the helm of the Conservative party or – if the Conservatives are re-elected in 2019 – leading our country.

Friends, let’s get the word out! We’re not only facing threats to our family farms from south of the border, we have a very real challenge right here at home too. If you want to enjoy the stable, competitive dairy prices that are the current reality, produced right here in Canada according to the highest safety, quality and animal welfare standards in the world — all the while benefitting family farms and rural economies across our country, speak up! Canadians need to understand that a vote for Bernier is a vote against food sovereignty, against family farms, and against the very fabric of our rural communities. Your help in sharing this message is appreciated.

Devastating News for our Friends to the South — and our response.

I’m a proud Canadian. I’m also a dairy farmer. I farm with my family, and our kids dream of farming themselves one day. I have dairy farming friends all around the world, many in the USA. Borders do not seem to matter to friendships; we’ve shared experiences and information, and celebrated successes and achievements with each other, irrespective of which side of the 49th parallel our farms are located. It’s understandable, then, that we hate to see our farming friends hurting and scared. You see, there’s been some very scary developments in the US dairy industry, specifically in Wisconsin. We’ve read with shock and dismay of the 75 farms that were dropped by their processor with just one month’s notice to find a new home for the milk that their cows produce. These are farmers with families, with bills to pay, with dreams and hopes for the future – just like their dairy farming compatriots across America and also up here in Canada. They also dream of seeing their children take up dairy farming in the future, but they now face the very real prospect of those dreams never becoming a reality. Their hurt is our hurt because we can understand just how painful this experience must be.

Farming is not just a job, it’s a lifestyle. It’s a lifestyle that we pour our whole selves into; our farms and our cows and our land are our life, our heartbeat, our hope for the future.

Seeing these dreams dashed and hopes destroyed is devastating, regardless of your nationality.

 

Allow me to briefly explain this issues at hand that have resulted in this situation. For years, several processors in the USA have exploited a loop hole in the trade regulations that control dairy imports into Canada. They’ve shipped a product called ultra- or dia-filtered milk north to Canadian cheese plants. Classified as an ingredient at the border, this product was able to pass our border controls tariff-free. However, once the product arrived at the processing plant, the classification was changed to dairy in order to be permitted for use under the Canadian cheese standards, which regulate which percentage of cheese ingredients must come from milk. This situation was causing our Canadian processors to forego using Canadian milk for their cheese, and sourcing the cheaper US diafiltered milk, reconstituting it, and using it in the cheese and other dairy products. As you can understand, this resulted in a loss to Canadian dairy farmers as our milk was no longer being used in this cheese – and it was no small sum either, some pin it at over $230 million annually! Over the past few years, our provincial and federal milk boards and committees have worked hard to create a way to encourage our processors to resume using Canadian milk. We’ve created a new class of milk that is priced at the world milk price. Now that our milk is financially competitive, several processors have dropped the American product and are sourcing all Canadian milk. We have not, as some sources claim, added import tariffs to the American ultra-filtered milk, we’ve simply made our milk the same price. Again, to repeat, no new tariffs have been created that would restrict USA access to the Canadian market. Canadian businesses have the right to choose their suppliers, just like American companies do. Business decisions may also be influenced by the fact that the American dollar, when it is high like it is now, makes it more expensive for Canadian businesses to buy American. This new pricing mechanism was adopted in Ontario last year, with the rest of Canada following suit several months later. US processors knew of our plans. It was no secret; there were several news sources on both sides of the border reporting on our efforts. Now that Canadian processors have resumed sourcing Canadian milk products for cheese, these American processors are left with unwanted filtered milk, and that has resulted in this terrible situation for those farmers. As many American farmers have accurately pointed out, the problem is not Canada’s dairy industry; the problem is the excess milk on the world market. The US needs to manage their excess dairy production more efficiently to prevent surpluses and this type of waste.

 

At this time, I’m incredibly grateful for our supply management system. With our system, if demand for milk falls, all producer quotas are reduced; individual farms are not dropped by processors. In my opinion, it’s a fair system that offers stability to farmers; stability that is necessary for innovation, growth, and the sustainability of the industry. I’ve read various comments from American farmers lamenting that fact that there is no such system in the US.

 

In my opinion, it’s not fair to blame Canadian dairy farmers or our supply management system for looking out for our own industry and attempting to regain the share of the market that once was ours.   I’m sure it should be obvious that this is not a time to point fingers or to adopt an “us vs them” mentality. At the same time, while our hearts go out to the farmers affected, we also need to look to our own farms and realize that we too need to make a living and ensure that our Canadian dairy industry remains viable.  I don’t claim to have answers or solutions to this problem. But I know that right now, those farmers dropped by their processors don’t need blame or acrimony, they need support and understanding and sympathy. They need help to find a new home for their milk, and I hope with all my heart that they will find a way to continue shipping milk and caring for their animals, land, and families.

 

Vote! The future of Canada’s dairy farms may depend on your choice!

Hello friends.

In just over two months, members of the Conservative Party of Canada will choose their new leader. By applying for a Conservative party membership by next Tuesday, March 28, you too can have a say in who becomes the next leader of the Official Opposition. Rona Ambrose has done a great job at the helm as interim leader but now it’s time to vote for the new long term voice and face of the party.

As dairy farmers, we’re watching this leadership competition unfold VERY closely. You see, all of the political parties in Canada have historically been supportive of the dairy and poultry industries’ current method of matching consumer demand with a supply of fresh milk, poultry, and eggs. Our system, called supply management, effectively protects our Canadian dairy sector’s vibrancy, viability, and important contributions to the Canadian economy while providing consumers with top-quality, safe, plentiful, and appropriately priced dairy products.

A few years ago, I shared the following description of our system in my first blog post about supply management: “In the 1960s and early 1970s, the Canadian government and Canadian dairy farmers came to the conclusion that production discipline – balancing supply and demand for milk products – was necessary to avoid extreme market fluctuations. Both the federal and provincial governments worked together with farmers to implement a system that is adjusted to suit the needs of Canadian demand for dairy. The system is administered by the Canadian Dairy Commission, which measures the demand for milk and sets the production limits accordingly. Plain white milk as well as any other dairy product labeled as Canadian is solely produced by Canadian dairy farmers for Canadian consumers. Milk is a local product, supporting local economies across our nation. The share of the market that each farm owns is called quota. Quota grants the farm a right to produce milk. The provincial quota is adjusted according to demand, and is increased or decreased as needed. Overproduction and waste are avoided because production is directly synchronized with consumer demand. Dairy farmers are paid a standard price for the milk they produce. This price is set by the Canadian Dairy Commission and is the result of a yearly national study of the cost of producing milk at the farm. Dairy farmers are paid the cost of producing the milk they ship to the processor.”

But with the prospect of a new leader for the party in official opposition to the governing Liberal Party of Canada, all of this could be in jeopardy. The two front runners in the race to become the new leader of the Conservative Party are no friends of supply management. In fact, one of the candidates, Maxime Bernier, has based nearly his entire platform on the premise that, if elected, he will do his utmost to dismantle this very system of stability, strength, and self-reliance that allows family farms across Canada to prosper. The other front runner, Kevin O’Leary, has oft times allowed his bias against supply management to show. Although he now professes that he supports supply management, he has also said that he will use supply management as a negotiation chip in any future trade deals. You can’t have it both ways, in my opinion!

The most infuriating part of all of this, however, are the half-truths and myths on which these candidates base their opinions. For example, they claim that consumers suffer as a result of supply management, claiming that Canadian consumers pay double the market rate for dairy products. Let’s take a look at that for a moment by comparing the prices in Canadian grocery stores to those south of us in the USA.

Screenshot 2017-03-21 15.04.16

Compiled by Nielson, this graph is a weighted average over one entire year of milk sales in a select number of countries with which Nielson has contracts. It’s a very accurate picture because of the sheer size of the study, taking into account purchasing habits and the length of time studied.

Well, would you look at that!

To compare apples to apples, we must compare the price of “hormone free” milk in the US to Canadian milk, as all milk in Canada is artificial-growth-hormone free. I’m sorry, but do you see what I see? It appears that Canadian consumers pay LESS than our neighbours to the south! Huh! Who would have thought that this would be the case considering the rhetoric spewing from the anti-supply-management camps!

As further evidence to these facts, check out this comment from a friend of mine who recently visited Florida with her children. This is what she had to say:

“US $4 for a gallon of partly skimmed milk (3.79L, not 4L like up here in Canada) while I’m used to buying 4 L for $4.29 Canadian.”

Figure in the current exchange rate, and you’re paying over $6.65 for less milk. Interesting!

Mr. Bernier also claims that the price of milk in the stores would drop if supply management were abolished. Just take a look at the price of milk in New Zealand. They abolished supply management, but the retail price of milk is higher than in Canada AND farmers are paid much less. Just last year many farmers were forced to exit the industry when the farm gate price dropped far below the cost of producing their milk. Do we want to see our family run dairy farms disappear from our nation’s landscape? If Canada were to dismantle supply management, our family farms would be a thing of the past as large conglomerates would swoop in to take over those bucolic farms dotting our countryside from coast to coast.

Critics of supply management often say that our system stifles innovation. I’d beg to differ. Every year we take part in a tour of the newly built farms in our small part of the province. There usually are 10 farms on the tour, and the technology and innovation is staggering. Robotic milking equipment, robotic feeding equipment and the latest equipment in animal welfare advances, to name just a few.  Family farms are able to invest in these sort of technological marvels just BECAUSE of the stability that supply management offers. Take a look at the graphic below. Canadian farm gate price for milk is stable, and sufficiently covers the cost of production, which allows for investment capital for these projects. This stability means that the banks are confident in our farms, and we are able to borrow the money to fund these innovative additions to our farms. Our farms are well maintained, in good repair, and feature the latest equipment and tools to provide the best care for our cows.

Screenshot 2017-03-21 15.04.52

It should now be quite obvious to you that critics of supply management are basing their opinion of our system on faulty information. But these critics refuse to listen to the voices of Canada’s dairy farmers. We’re facing a very real, very immediate problem. If an anti-supply management candidate is elected in this leadership race, we could stand to lose much of our support in Ottawa if the voice of the official opposition does not hold the governing Liberals’ feet to the fire when or if our system comes under attack during trade negotiations and the like. And I shudder to think of what could happen should the Conservatives be re-elected in 2019 and either of these candidates would become Prime Minister. Not an ideal situation in the least!

Now that you understand the threats facing our family farms, would you be interested in helping to keep our system intact and benefiting both consumers and farmers? Here’s what you can do: Become a member of the Conservative Party of Canada by March 28, 2017. Membership is open to all citizens and permanent residents of Canada above 14 years of age, provided they are not a member of another political party. A one year membership is just $15 and allows you to vote in this coming leadership election to be held on May 27. We, along with our fellow Canadian dairy farmers will be watching the race with interest, and will in all likelihood be in communication with one another about which candidate we feel will best benefit all of Canada, dairy farmers included. Due to the way this vote will be structured, it will be important for all dairy farmers to vote as a block in order for our votes to be of any influence in the outcome. We have a few more weeks to decide who this candidate will be. I’m curious to hear from candidates, their staff, and other interested parties about who they think will be the best person to man the helm of the Conservative Party of Canada going forward.

Until next time,

Julaine, a Canadian dairy farmer.

Organic and Conventional Farming: Different, not Better

Every farmer I know has been asked questions about why they farm the way they do. The most common question we are asked about our farm is why we farm organically. I shared our reasons for transitioning to organic as well as the basic differences between organic and conventional farming here.

This morning, I was extremely interested to read this post by The Farmer’s Wifee, a dairy farmer in Washington State. http://www.thefarmerswifee.com/farm-not-organic/
Krista shares the reasons why she and her husband do not farm organically. And I can totally understand and respect their decision. But what I respect even more is her method of relaying this information to her readers. She writes about their choice to farm conventionally without once denigrating the organic way of farming. I LOVE that! I’ve previously lamented the current trend of farmers and farming groups “bashing” other types of farming, here and here. It saddens me to see farmers and farming groups promoting their method of farming by throwing other types under the bus, so to speak. I firmly believe that we all should be able to explain why we farm the way we do without feeling the need to diminish other farmers and farm types.

Labels do not make one farm better than another. Period. Conventional and organic farmers both farm in the way that they feel best benefits their land and animals and is the best fit for farmer and farm family and their extenuating circumstances. For example, Krista’s farm does not have enough pasture land close enough to their barns in order to meet the pasture requirements of the organic standards. But they make the effort to have their heifers on leased pasture during the grazing season. Does this mean that their farming method is not as “good” as ours just because our milk cows are pastured? Absolutely not! And no one should ever make them feel that way!! And while the US organic standards forbid any antibiotic use in dairy cows, in Canada, cows are permitted to be treated with antibiotics if they become ill, albeit with very strict restrictions regarding milk withdrawal times and treatment frequency. I’ve often wondered if we would have made the switch to organic if antibiotic use was not pemitted here. Like Krista, I love our cows too much to want to consider the possibility of having to sell one of our girls if they should need antibiotic treatment.

We switched to organic farming because it was a good fit for our farm and family, and because we like the thought of giving informed consumers more choices in the dairy aisles of their grocery stores. Farmers, please join me in the fight for farmers and farm groups to support each other, regardless of farm type. I don’t mind of you adopt my motto regarding farming styles: “Farming a certain way doesn’t make us better, it simply makes us different.” 🙂