Alberta Milk extends new farmer quota repayment plan
Merein and Kelsey Van Benthem believe they would not have been able to start farming without Alberta Milk’s quota loan program.
They’re also convinced that the most recent changes will ensure their success as dairy farmers.
“We feel pretty confident now we will succeed as farmers,” said Kelsey.
The couple from Spruce View, Alta., struck out on their own three years ago with a dream to run a dairy farm.
They bought their own farm with the help of the New Entrant Assistance Program, which Alberta Milk created in 2011.
The program loans quota to new dairy farmers to help ease the burden of one of the major expenses in starting a new farm.
Twelve new dairy farmers have started operating in the province since the program began.
“We had quite a few brand new farmers, and they just wanted to be dairy farmers,” said Karlee Conway, communications manager with Alberta Milk.
The program is based on a 2:1 ratio of loaned to purchased quota to a maximum of 25 kilograms per day at no cost to the new entrant, which will provide enough quota to milk 20 to 25 cows.
The original program loaned a maximum of 15 kg per day.
The most recent changes also give farmers 10 years to buy the loaned quota instead of seven in an effort to ease the financial burden.
“They were struggling a bit,” Conway said.
“All farming is expensive.”
The Van Benthems say the changes have allowed them to begin buying more quota.
They now have 15 kg of loaned quota and the rest is leased from other farmers for their 50 milking cows.
The goal is to have 70 kg of quota in 10 years, which is the maximum allowed under the new entrant program.
“We’re now hoping in the next year to purchase more quota and won’t have to lease as much,” Kelsey said.
They eventually want to double their herd so that they can milk 100 cows.
April’s closing price for quota was $38,330 per kg of butterfat.
Conway said the average new entrant has 40 cows, and the program changes will allow them to increase their herd by 20 to 25 cows.
The average herd in Alberta is about 100 cows, she added.
The loan now begins to expire in Year 7 and is reduced to zero in Year 10.
She said the program is designed to encourage new farmers rather than act as a succession plan for existing producers.
Alberta Milk set aside the loaned quota rather than taking it from existing dairy farmers.
New dairy farmers can apply to the program until June 30.