Organic Dairy produce

[nakodo]

The market (consumers) are seeking, at very large margins I might add, organic dairy produce, milk, cream, yogurt and other products - I challenge any dairy producer to tell me why their industry is not satisfying this niche, why do consumers have to buy California yogurt, why do I see Quebec organic products in Alberta, BC product in Saskatchewan? Is the quota system so lucrative no one has to supply what the consumer wants???

[cakadu]

I'd be kind of curious to hear responses as well. I know that there are smaller farms opting to go the organic route that have come up against some difficulties with respect to the quota system and what has been built up around it.

I'd be interested to find out how both organic and conventional (for lack of a better term) could be allowed to function within the same system. It would seem to me that those that would want to go after that lucrative niche market should be allowed to do so. Not everyone is going to want to capture that market for a variety of reasons, but the opportunity to do so should exist.

[emwile]

I am no expert in organic milk production however I am familiar with some of the marketing activities related to organic production across Canada - Nova Scotia, Ontario and BC.

We have a national system for production of industrial milk products such as cheese, butter, yogurt and ice cream. These products travel easily across provincial lines and this is part of our system. For some producers who have organized themselves (in Quebec and Ontario)into cooperatives they have been searching markets outside their provincial boundaries to sell the volumes that are required for efficient processing runs etc. I am not sure about the yogurt coming from the US. With only 3 or 4 retailers more and more the industry is facing the challenge of listing a product and then making it available under a national contract. This as you can appreciate requires volumes as well.

As for organic production within the confines of the supply management system...Canadian supply (quota) is based on a quarterly review of consumer demand. Quotas are adjusted regularly (just been discussing an adjustment of quota on a conference call this evening) to reflect changes in demand during the year. The demand for all dairy products - organic and conventionally produced products is considered. If the organic production is outside the "system" we begin the erosion of one of the fundamental concepts of the orderly marketing system and that is a "system of controlled production reflecting consumer demand". Many provinces have adopted policies that reflect support for organic production within the current supply management system.

Currently in Nova Scotia any producer could choose to produce milk organically. In many respects this would be the easy part. The bigger challenge would be in finding a processor that would process and market the product.

In Ontario the producers who are involved in organic production receive the same farm gate price as all other producers. They capture a premium through their marketing organization. They have formed a cooperative and receive the financial benefits through the company. I am not sure whether it is patronage or some other premium based on volume etc.

In BC I know of a producer who has one farm under traditional production methods and another under organic methods. He has purchased or is a major shareholder in a processing facility which also does the marketing.

From a producer point of view... those of us currently under conventional production practises would have severe financial issues because of the time required 3-5 years(I believe) to reach organic certification standards. It seems the only way is to start up under these organic methods or acquire another farm that could be converted to organic production, using the existing farm to help finance the conversion process.

It is my own belief that our current supply management system can respond however we are just beginning to see the demand start to grow to a point where producers, processors and retailers can economically provide the product on a more widespread basis.

To date there is no organic production in Nova Scotia and I am not aware of any in New Brunswick and Prince Edward Island.

[nakodo]

My research shows fluid milk is not probable as the remaining milk processors are so large any organic production would not even make a minimum run in the equipment.

Looks like the fresh organic milk will come from other suppliers than our local farms.

There may be some hope for processed organic products such as yogurt, butter, cheese etc. as the production runs for these are smaller due to the survival of the small independent producers around the region.

[lang]

I believe I read some statistics about organic dairy in the US that the cow turnover was substantially higher than if it was a non-organic farm. This was primarily due mastitis control as they were unable remove the cow and treat her. This raised the cost substantially for the producers.

[dkelly]

I attended the Grocery Innovations conference in Toronto a few weeks back. There were a number of "organic" dairy producers sporting their wares.

One in particular who also had extensive written materials:

OntarBio Organic Farmers' Cooperative Inc.
RR #1
Durham, Ont.
N0G 1R0

[emwile]

There is a dairy processor who is contracted to process and distribute the milk produced by these organic producers in Ontario. I don't know the name. This milk is being distributed by Atlantic Superstore in the Halifax area.