PORTAGE LA PRAIRIE, Man. – The prospect of Puratone having a role in the dairy industry has sounded alarm bells for at least one Manitoba milk producer.
The Puratone Corporation of Niverville, Man., is working with a group of dairy farmers considering merging their quota and building a corporate-managed barn. Puratone is best known for its stake in a large network of hog barns and feed mills in Manitoba.
Hans Borst of Elm Creek, Man., worries Puratone might gain a stake in Manitoba’s milk industry. He’s an advocate of family farms and objects to the idea of a corporation as big as Puratone being involved with a milk barn.
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“I have no intention to see them dabble in the industry if I can avoid it,” said Borst, who owns a 400-head dairy. “To me, it’s a red flag.”
The head of Puratone said the corporation does not plan to have an ownership share in the dairy barn. Puratone would manage the barn, said president and chief executive officer John Koslowsky.
“It would be a producer-owned organization,” Koslowsky said. “Instead of them all running their quotas in a bunch of small operations, it would amalgamate them all into one large operation.”
Discussions about the dairy barn are still in the early stages. Producers could ask that Puratone have some ownership in the venture, giving the corporation an added incentive to see the project succeed. However, Koslowsky said Puratone would not consider having more than 10 percent ownership.
Among those interested in the venture are dairy producers who have grown weary of doing chores seven days a week. “This gives them the opportunity to stay in the milk business and be relieved of the day-to-day operation of it,” Koslowsky said.
If Puratone buys into a dairy barn, Borst believes such a venture would have an unfair advantage over other dairy farms in the province.
“The family farm can’t compete on a level playing field with these operations,” he said. “They can access soft money (shareholders’ capital.) The family farm doesn’t have that opportunity.”
Borst made his views known at an Oct. 20 district meeting of Manitoba Milk Producers, the provincial marketing board. Although he has concerns about Puratone entering the milk industry, he said he has no objections to several milk farmers banding together to build a large barn.
Borst thinks a style of life is being eroded as corporations become more common in farming. He worries that farmers will become workers rather than owners in farm enterprises.
The subject drew only brief discussion at last week’s meeting. Chair Neil Van Ryssel neither condemned nor endorsed the idea of a venture involving Puratone.
“I think the producers that are going into it will be as good a watchdog as we need in ensuring their best interests are served,” he said. “I don’t think we have to get involved to safeguard their assets.”
Dairy farms in Manitoba are gradually becoming larger. Due to the costs of building a new dairy parlor, it makes economic sense for small- and medium-sized producers to share those costs, Van Ryssel said.
