Nov 2008 - Proposal could harmonize quota policies
A proposal that would harmonize the rules for dairy quotas is under consideration in Ontario and across the other P5 provinces.
All dairy producers in five Eastern provinces would operate under the same rules-with a few exceptions-if their provincial marketing organizations
adopt a proposed harmonized quota policy.
P5 producer marketing organizations in Nova Scotia, New Brunswick,
Prince Edward Island, Quebec and Ontario are now considering the proposal.
As early as Aug. 1, 2009, it would set up a P5 pool quota committee
to make decisions and eventually cap quota prices at the same
level in all five provinces if implemented.
Unveiled last month, the quota proposal grew out of a P5 producer
forum held a year ago in Ontario. Delegates urged the P5 to develop a
pool-wide governance model. The five provincial chairs agreed to develop
a harmonized quota policy as a first step, and struck a committee that included themselves and the general managers of the five marketing organizations.
Ontario producers got their first look at the policy proposal at the DFO
Fall Policy conference mid-October. Delegates from dairy producer committees
across the province strongly endorsed the policy direction while
also raising issues they would like to see discussed further or changed.
Copies of the harmonized quota proposal were mailed to all Ontario
producers a few days after the Fall Policy Conference.
The proposal was discussed at the P5 Policy Forum, which was held
in Moncton in early November. DFO’s Board members plus 12 more dairy
farmers from across Ontario participated in the forum with their counterparts
from the other four provinces.
The majority of P5 delegates also supported the proposal. Details will
be discussed at the 2009 County Annual Meetings and the 2009 Spring
Regional Meetings. For more details, see the article which begins on
page 32 of November’s Milk Producer magazine.
Oct 2008 - Board Issues Six Incentive Days October Through January
The Board has issued to producers six incentive days in order to inject much
needed production into the provincial system. Fall production-to-date in 2008
lags that of 2007 by about 4.5%. The incentive days, calculated on a producer’s
October 1st quota holdings, should help to fill the gap between the current
production trend and the obligation to produce 97% of August-January provincial
quota. Note that producers’ October 1st quota holdings were increased
following the latest bi-monthly national industrial quota adjustment.
A producer must over-produce during a month in order to tap into his six-day
incentive block. The incentive block is cumulative; incentive kilograms can be
utilized at any time during the October 1-January 31 period. Once a producer
has fully utilized his incentive kilograms, over-production would then increase
his credit position. Here’s an example of how it works (all figures in
kilograms).
Sept 2008 - Quota increase in Nova Scotia
The DFNS Board of Directors has increased quota 3.0%, as non-saleable for all active producers effective October 1, 2008. This increase in allocation should send the strong signal that Nova Scotia producers need to retain animals and produce more milk in the coming months.
This 3% increase (2% to become fully allocated, plus 1% over-allocated) will remain in place until the province recovers from lagging milk and butterfat production. The Board and staff will monitor production carefully and implement future quota increases or decreases, as production and market conditions dictate. Our objective is to exceed the 97% provincial quota fill requirement by the end of January 2009.
Reasons for the increase are:
· NS did not receive a prefill quota reduction for 2008/09;
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To fill the 2% under-allocation from August 1, 2008;
· To over-allocate by 1%;
· Declining provincial milk volume in the last six to eight weeks;
· Modest market increase predictions; and
· Only four months remaining until the 97% measurement.
August 27, 2008 -
Fall Incentive Days Increased
The DFO Board decided today to increase the fall incentive days by adding one day per month for each of the months of September, October, November and December. This means that two incentive days will be available for September through November and one incentive day will be available for December. It is also the Board’s intention to completely withdraw the incentive days in January to ensure that production levels are maintained reasonably in line with quota holdings going forward.
The reasons for increasing the incentive days are as follows:
1) At the provincial level, Ontario has an obligation to fill at least 97 per cent of its quota in the first six months of the dairy year. The addition of fall incentive days is needed to ensure that Ontario meets or exceeds the 97 per cent obligation as a province. As a province, any production below 97 per cent is available for other provinces to fill during the second six months of the dairy year. It is a temporary adjustment with a province’s full quota available at the beginning of the next dairy year.
2) Market demands for milk tend to be fairly even throughout the year. Historically, Ontario does not fill its quota in the fall months. That is true again this year. We need to encourage more fall production to meet our customers’ requirements.
3) Production trends, in most other provinces, including Quebec, are also indicating that filling their quota will be a challenge throughout the country.
In general, incentive days permit producers who have the ability to market more milk in the short-term to do so. They should not be regarded as a signal to gear up production for the longer term.
The Board appreciates that it is not easy at the farm level to turn supplies on and off on short notice. However, from a provincial perspective, we do need to take steps to fill as much of our provincial quota as possible. The increase in incentive days is viewed as a step to help ensure we meet that goal. Note again that there will be no incentive days after December 31, 2008. Producers should always target to produce 100 per cent of their daily quota.
