An overwhelming decision by Nova Scotia dairy farmers to maintain the $25,000 cap on quota value will have national repercussions, says an industry official.
“It was a decisive decision, an overwhelming statement, that I think puts the issue behind us,” said Dairy Farmers of Nova Scotia general manager Brian Cameron.
“I think it reaffirms the co-operation between provinces on the dairy policy harmonization issue. It has been noted nationally.”
In early August, 176 quota holders — 75 percent of the province’s producers — crowded into a room in Truro, N.S., to vote on a proposal that the province pull out of a five-province 2009 deal to cap quota prices.
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The deal in the so-called P5 group (Nova Scotia, Ontario, Quebec, New Brunswick and Prince Edward Island) was aimed at harmonizing policies between provinces and also to reduce the cost for younger entrants into the industry.
At their peak, Nova Scotia quota prices hit $35,000 for the equivalent of one cow’s annual production.
Opponents of the cap argued that reducing it to $25,000 would deprive farmers who purchased high the right to recoup their investment.
They twice took the provincial dairy association to court on the issue and lost.
They then elected members to the association board and won support for a motion that the marketing board rescind its policy. At the Truro meeting, they lost again.
A resolution from the floor suggested that the board reaffirm its support for the cap.
The vote was 162 for and two opposed with one abstention and the board members, who didn’t vote.
Other provincial members of the P5 were relieved. Members from western provinces and Newfoundland and Labrador, who are part of talks to create national rules and a national dairy pool, saw the vote as an affirmation of industry resolve to work together.
“I think this strengthens the harmonization efforts of the provinces, and that is a very positive outcome,” said Cameron.
“I believe it does set a national example, although the provinces not in the P5 have to make their own decisions.”
He said “the question of a quota cap in the other provinces has not been on the radar” in national discussions.
The powerful Dairy Farmers of Ontario warned of the consequences when it appeared earlier in the summer that Nova Scotia producers could be heading toward dropping the cap.
It said the P5 agreement had been created to provide equity between producers in the five provinces and to ensure that processors faced the same conditions.
“A withdrawal from that commitment would need to be assessed by the other P5 provinces in the context of the overall objectives pursued by the P5 harmonization process,” the Ontario group warned in a summer statement.
The implication was that Nova Scotia could lose the benefits it had by being part of P5.
