The new president of Canada’s influential national dairy producer lobby took office last week at a time when the industry is reeling from unprecedented change and unease about the future of its supply management system as the world prepares for more trade talks.
On Jan. 18, Leo Bertoia of Langham, Sask., became the new president of Dairy Farmers of Canada.
He said in an interview he believes the nation’s 20,000 dairy farmers are united behind the organization and its fight to preserve supply management.
But the 56-year-old veteran of provincial and federal dairy politics also conceded the prosperity of the $4 billion industry couldn’t be taken for granted.
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“I think farmers are confident that this system is the best for them,” he said. “But they realize there are challenges and that they have to be prepared to fight for it.”
During three days of policy discussions and speeches at the annual DFC conference last week, the contentious issues Bertoia is inheriting were close to the surface.
They include income worries, trade fears, environmental pressures and questions about the structure of the supply management system itself.
- Income: Although they are among the highest average farm income earners in the country, delegates were adamant that the existing cost-of-production formula should be changed to ensure that more dairy producers receive their costs from the market.
DFC says the existing formula returns true costs to only one-third of dairy farmers. “We think it should be at least 50 percent,” said Bertoia.
Revenues fall below costs when provincial boards set table milk prices lower than the national industrial milk COP formula, and as more milk is sold into lower-priced processing or export markets.
New Brunswick’s Jacques Laforge complained that the $1.28 per hectolitre increase in prices, which takes effect Feb. 1, will not even cover his increased fuel bills this year.
- Trade: The Canadian dairy industry faces another World Trade Organization challenge to its export policy this year and WTO trade talks could start again with pressure to lower tariffs that protect supply management.
- The environment: Delegates from a number of provinces said they are facing pressure over the public unease about intensive farming and water pollution or environmental degradation.
Quebec wanted a policy statement that lauded supply management because it allows smaller farmers to make a living and “can avoid the environmental pressures caused by a large concentration of farm enterprises closer to major urban centres.”
Reference to the potential for environmental problems was removed after delegate Wally Smith from Chemainus, B.C., said his provincial government already considers farmers polluters.
It may be true that larger farms pose more of a pollution threat than smaller farms, he said. “I don’t want to see it in writing.”
- The system: The need to reform the rules for milk exports has caused a major change in how supply management works during the past year and Bertoia said leaders in the industry must be certain milk production is controlled.
Milk processor president Kempton Matte of the National Dairy Council warned that too much milk is being produced and growing stocks of butter and cheese could start to put pressure on prices.
