Keep Feeding Our World

Quebec has a very real deficit in its dairy processing capacity. In fact, we have reached a stage where the current state of affairs is quite simply no longer acceptable, because market changes are only making the problem worse.

We must add more capacity if we want to be sure that the market can grow. To sustain market growth and keep in step with consumer choices, we need development programs that will encourage the investment required to increase dairy processing capacities in Quebec, especially capacities that increase the value of solids non-fat (SNF) structural surpluses. Globally, demand for butterfat is stronger than demand for SNF, which means that the industry is grappling with surpluses not required in the Canadian market. The quantity of SNF is increasing and will continue to do so, especially because consumers are choosing more and more fat-rich foods, like butter and cream, and less and less fluid milk. The trade conditions under the Canada–United States–Mexico Agreement have also exacerbated the problem because there is a cap on exports of skim milk powder and milk protein concentrates, which limits our opportunities for SNF. This issue is now so critical that it is creating a serious obstacle to the sustainable development of our sector.

There are risks that come with limited processing capacities, and we saw a very real example last summer in the labour dispute at a high-volume plant. When Quebecers saw the images of milk being disposed of, they became aware of the limited processing capacities in Quebec and Eastern Canada and how this can unfortunately lead to food waste.

Supply management is our model. Every day, we work hard to produce high-quality milk. This product is the fruit of our daily labour, which begins over 24 months before the first litres of milk are produced by a cow. Production in Quebec is planned several months in advance to ensure that the plants are supplied so that they can meet consumer demand as accurately as possible.

 

The Quebec and Canadian governments must invest in protecting our revenue and preventing product waste. These requests were passed along to the political parties during the electoral campaign in Quebec, and we will see if something is done about them.

 

Processing plants generally work at maximum capacity. As soon as an unforeseen event occurs in the processing sector, such as a strike, a breakdown or unplanned maintenance in a plant, considerable efforts have to be made to find takers for the milk. All solutions are then considered: We ask for assistance from other plants in Quebec and Eastern Canada, from the Maritimes to Ontario. When possible, we make donations to food banks. Finally, when there are no other options, we have to dispose of the by-products from dairy processing to make sure that as much fat as possible can be processed in the market. Unfortunately, exceptional situations like the one this summer sometimes leave us no choice but to dispose of whole milk. We do this only when there are no other solutions and, as producers, we have to absorb this lost revenue collectively. There is no program to cover these losses, which can amount to several millions of dollars.

Clearly, this situation is unacceptable in every way. To keep this type of situation from recurring, we must act collectively with all stakeholders in the sector, including the Quebec government, which must also play a critical role. The government needs to develop legislative tools to keep plants processing at minimum capacity during labour disputes. Due to the very nature of animal farming, certain operations should be considered essential and maintained at a minimum level at all times to avoid food waste.

Quebec’s precarious dairy processing capacities leave our industry vulnerable. We may also be affected by other crises or labour disputes that could cause food waste. We have no margin for error. The Quebec and Canadian governments must invest in protecting our revenue and preventing product waste. These requests were passed along to the political parties during the electoral campaign in Quebec, and we will see if something is done about them. It is simple; the government must look ahead and give the industry the tools it needs right now to face potential crises, but also to ensure optimal growth management in the future. Quebec is a leader in many Canadian dairy processing sectors, including yogurt, cheese and organic milk production. We need to save our strength here so that we can continue to innovate and feed the world.

 

SignatureDanielGobeil

 

Daniel Gobeil, chairman

 

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