Alberta dairy farmers will be allowed to slightly increase milk production this fall due to an expected uptick in demand.
The one percent quota increase, approved by the Alberta Milk board last week, comes in time for back-to-school and the holiday season. The increase takes effect Sept. 1.
“Kids will be needing more milk in the morning for their cereal and schools need it for their lunchtime milk programs,” said Albert Kamps, vice-chair of Alberta Milk.
“Butter and cheese consumption also goes up for Thanksgiving and Christmastime.”
Kamps couldn’t say what the one percent increase means in extra kilograms, but said it’s normal for the board to increase production for this time of year. They meet every month to see whether or not quota should change.
But it’s not only the appetites of consumers that are pushing up demand.
Kamps said many dairy farmers have almost used up their farm credits. The credits allow them to go over their quota in times of high demand.
He explained that if farmers ship less than their quota on any given month, they build up a credit. But when they go over their quota, they must use those credits.
“We’ve seen our credit supply dry up, hitting that zero mark where there weren’t any credits on farms,” he said. “When that happens, we start to see production peel back. If farmers aren’t going to get paid for their milk, they won’t ship it.”
Processors are also demanding more product. However, production capacity is nearly full in Alberta, which creates a host of other challenges for farmers.
Kamps pointed to Manitoba as an example of where max capacity can create problems. He said before that province got its new processing facility, quota was lowered significantly because there was nowhere close to process. It affected incomes for many farmers.
“If there is nowhere to process, there’s no point in producing,” Kamps said. “We’re pressuring processors to step up to the plate and build more capacity in Alberta.”
As for other ways to meet increased demand, Alberta Milk is allowing farmers to have an additional incentive day in December. Throughout the months of September to December, there will be a total of seven incentive days.
Kamps said incentive days let farmers ship extra milk when they’ve gone over their quota. The incentive doesn’t apply to farmers who haven’t gone over their quota.
Kamps explained the incentive days are used to encourage farmers to breed cows in late summer to early fall rather than in the spring.
He said cows supply less milk during the fall, but that is when demand is highest, so having more calves during that time to meet demand would be helpful.
Source: Western Producer