Dairy Industry Deals With Oversupply

Apr 07, 2020

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COVID-19 is having an impact on a variety of industries including the dairy industry.

The dairy industry is dealing with an oversupply issue after restaurants, hotels, schools, and university’s shut down dine-in meal service.

Gert Schrijver has Marsfield Holsteins at Stettler and is the Alberta Director with Dairy Farmers of Canada.

He says with the shutdown dairy producers have been dealing with an oversupply of milk that would normally be consumed and are dumping it according to the environment and government regulations.

‘’We are working hard as an industry with processors and retail to solve the issues right now. We are committed to our products, the nutrients levels and the sustainability of our industry. We will make it work and it will become better in the future again, for sure. Dumping is a short term solution, and we're (DFOC) working on common rules to prevent it down the road in the next few weeks.’’

He notes, usually 25% or 30% of the dairy products go into hotels and restaurants and then the distribution chain dried up.

‘’So, now all that product has to go to the retail store, it needs some adjustments at the retail and distribution level. We've been (dairy producers) donating lots of products to the food bank to help the community.’’

Dairy cows produce a certain amount of milk each day and need to be milked on a regular basis in order for the animals to be comfortable and healthy.

Blaine McLeod is a dairy producer at Caronport and is the Saskatchewan Director with Dairy Farmers of Canada.

He says the dairy industry is helping supply food banks, soup kitchens, etc, but they can only take so much; noting that dumping the oversupply of milk is a short-term solution for now.

McLeod says while he doesn’t have specific numbers on what’s being dumped it’s in the single digits in terms of oversupply, probably less than 5% is surplus, but that's a lot of milk.

‘’ We are the first people as dairy farmers to cry over spilled milk, it breaks our heart to see that kind of thing happening. Because we put tons of effort into the care and humane treatment of our cattle and making sure their needs are met and having them produce to the maximum or their capacity. Then to say, as an industry, we've got more milk than we can use, and we have to dump it.’’

McLeod says the industry is looking at options to slow production but that will take time.

‘’You can't just put a cow on a shelf and then take her off when you need the milk again, that just doesn't work that way. To have the supply in terms of food security, there really is only one option for us right now; and that's to actually take and dump the milk where it's not being able to be used.’’

He notes producers will be evaluating their herd keeping in mind that they’ll need to be able to ramp production up again down the road.

‘’So, people will be prematurely drying up cows, that kind of thing. Just to slow the milk supply down as much as possible. That type of thing will happen and people will be looking very closely at their herds as to which cows they can cull.’’

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