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Edit of Dairy Farming in Canada Introduction

Dairy farming is one of the largest agricultural sectors in Canada. Dairy has a significant presence in all of the provinces and is one of the top two agricultural commodities in seven out of ten provinces.

milk

In 2017, there were 945,000 dairy cows on 10,951 farms across the country. Quebec and Ontario are the major dairy producing provinces with 49% and 33% of the farms being present in these provinces, respectively. While dairy farming is still prominent in Canadian society, the rate of dairy farmers in Canada has been dropping significantly since 1971.

The Canadian dairy sector contributes roughly $18.9B yearly to Canada's GDP, and sustains approximately 215,000 full-time equivalent jobs. On average, two-thirds of Canadian dairy produced is sold as raw milk while the remaining one-third is refined into other dairy products such as milk, cheese and butter.

In Canada, dairy farming is subject to the system of supply management. Under supply management, which also includes the egg and poultry sectors, farmers manage their production so that it coincides with forecasts of demand for their products over a predetermined period. Restrictions on supply management while take into account certain imports that enter Canada, as well as some production which is shipped to export markets. Imports of dairy, eggs, and poultry are controlled using tariff rate quotas, or TRQs. These allow a predetermined quantity to be imported at preferential tariff rates (generally duty free), while maintaining control over how much is imported. The over-quota tariffs are set at levels that allow Canadian farmers to receive a price reflecting the cost to produce in a northern environment.

While there has been some push back regarding the supply management system, research shows that the Canadian population generally is satisfied with the current supply management system. In fact, a recent initiative by the Dairy Farmers of Canada was to have dairy products that contained 100% Canadian dairy products indicate this by using a specific label that states, “100% Canadian milk”. A follow-up study investigating the impact of such a label revealed that Canadians were willing to pay more money for dairy products that specified using 100% Canadian milk products, versus its non-Canadian certified counterparts .

Supply Management

The government of Canada put in place a supply management system in the early 1970s in an effort to reduce the surplus in production that had become common in the 1950s and 1960s, and ensure a fair return for farmers.

Supply management is a shared jurisdiction between the Federal and Provincial governments. For example, on a Canada-wide basis, there is the Canadian Dairy Commission, composed mostly of dairy farmers. In Ontario, there is the Dairy Farmers of Ontario, with similar local boards in each of the other provinces.

In 1983, the National Milk Marketing Plan came into effect to control supply, setting guidelines for calculating Market Sharing Quota. This agreement is between the federal and provincial powers. The Milk Marketing Plan was created to replace the Comprehensive Milk Marketing Agreement, which was initially established in 1971. By 1983, every province except Newfoundland had signed onto the Milk Marketing Agreement. Following dairy, a national supply management system was implemented for eggs in 1972, turkey in 1974, chicken in 1978 and chicken hatching eggs in 1986.

The basic idea behind supply management is to manage production so that supply is in balance with demand, and the farm gate price enables farmers to cover their costs of production, including a fair return on labour and capital.

Each farm owns a number of shares in the market (quota), and is required to increase or decrease production according to consumer demand. Because production is in sync with demand, overproduction is avoided; this enables farmers to earn a predictable and stable revenue, directly from the market.

A supply management system for Canadian dairy products is beneficial to Canadian dairy farmers. However, the consequence of such a system is artificially high dairy prices in Canada which has shown to have an impact on the consumption of dairy products in Canada. Due to these artificially high prices, individuals are consuming less amounts of Dairy products and instead consuming dairy substitutes, such as almond or soy milk, at a higher rate. In addition to lower amounts of milk consumption, the negative impact of supply management within the Canadian dairy system includes Canadians being unable to participate in the global dairy market, limiting competition that would reduce current prices. This is a concern for some parties of interest who believe that the process of supply management should be done away with in light of Canada's commitment to free trade. Furthermore, there is concern of the impact that supply management has on dairy prices, given that the amount of dairy farmers in Canada has been significantly dropping since 1971.

Canadian Dairy Farming Regulations

Canadian dairy farmers have strict regulations outlined by the Canadian Food Inspection Agency to ensure proper oversight of dairy production and to guarantee that strict standards of biosecurity are upheld. These regulations provide clear guidelines for Canadian dairy farmers to adhere to in order for them to ensure biosecurity standards are maintained in the sectors of environmental protection, human health, animal health, and animal welfare. In adhering to these regulations, dairy farmers can make certain that dairy standards are sustained, ensuring satisfaction for consumers of Canadian dairy products.

Canadian Dairy Farming and Environmental Impact

cow being milked

The Canadian dairy industry is responsible for 20% of total green house gas (GHG) emissions generated in Canada by livestock agriculture, which is made up of the dairy, poultry, swine and beef industry. 90% of the GHG emissions caused by Canadian dairy farming occurs as a result of events on the farm, whereas only 10% GHG emissions are emitted as a result of off farm processes such as the producing and refining of secondary milk products into cream, butter and powdered milk. The greatest amount of GHG that is produced by Canadian dairy cows occurs at the time of lactation.

GHG emissions from dairy farms in Western Canada are typically lower than in Eastern Canada, primarily as a function of climate and raw milk production in comparison to the climate and milk production processes utilized in Eastern Canada. Consequently, the Eastern provinces of Canada contribute to 78.5% of GHG emissions created by the Canadian dairy farming industry.

Canadian Dairy Farming, Feed Sources, and Greenhouse Gas Emissions

The type of feed utilized by Canadian dairy farmers has a significant impact on the amount of GHG emissions as a result of dairy production. Canadian dairy farmers commonly feed their cattle corn or barley silage as high nutrient food sources to increase milk production. Although corn and barley are both efficient and economic sources of feed, these two feed sources are responsible for large amounts of greenhouse gas (GHG) emission in Canada. While both of these types of feed contribute to significant amounts of GHG, research reveals that corn produces lower amounts of GHG in comparison to barley. In examining the use of these two types of feed, comparison of measurements of CH4, N2O and CO2 suggests that total GHG emission in Canada produced by a single cow based on amount of milk production is 13% lower when the cow is fed corn compared to barley. Additionally, corn silage feed is attributed to higher milk production across dairy cows compared to barley silage feed.

Despite the decrease in GHG in utilizing corn feed for Canadian dairy farms, when examining processing and transportation costs of feed for Canadian dairy farms, corn silage production is responsible for a 9% increase in CO2 compared to the processing and transportation costs associated with barley silage production. Despite higher rates of GHG due to transportation costs, Corn still results in lower rates of GHG overall. While corn and barley are two commonly used types of feed by Canadian dairy farmers, the feed source of the forage, alfalfa, while less commonly used is a feed source that would further decrease GHG emissions, in comparison to corn.

Organic Dairy Farming in Canada

dairy cow

Both organic and conventional dairy farms exist across Canada. Organic dairy farming in Canada is far less prevalent however, this is primarily due to widely held misconceptions that organic farming is unprofitable and risky, as organic farming is attributed to a significant degree of self-sufficiency for all aspects of production. Consequently, conventional farming is perceived as being highly advanced technologically, utilizing efficient fertilizers and automated processes throughout the farm, driving down costs associated with physical labour. Conventional farming is, therefore, widely perceived as being the more modern and economically successful method of dairy farming in Canada.

Contrary to this belief, costs associated with organic farming are substantially lower than costs incurred by conventional farming. Organic Canadian dairy farms have been shown to have a lower overall cost of production and are more self-sufficient in terms of plant and animal nutrient recycling and restocking of livestock herds. In contrast, the larger economic surplus enjoyed by conventional dairy farms in Canada is often offset by extra costs associated with importing fertilizers, seed, and replacement cattle, making conventional farming no more economically profitable than organic farming.

Notes For Future Improvement

I will provide sources for previously written, non-cited material in introductory paragraph regarding supply management.

Some topics I wish to address for the article's discussion on Canadian dairy farming includes an examination of the environmental impact of Canadian dairy farming and an overview of organic dairy farming in Canada. In particular, for examining environmental impact I would like to examine what the negative impact of Canadian dairy farming has been on the environment, the difference of environmental impact due to the type of grain eaten by the dairy cows, and environmental regulations in place to govern Canadian dairy farms. In addressing organic dairy farming in Canada, I would like to examine how the environmental impact of organic dairy farming compares to non-organic dairy farming as well as I would like to examine the spread of bacteria in Organic milk compared to non-organic milk.

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Guyader, J., Little, S., Kröbel, R., Benchaar, C., & Beauchemin, K. A. (2017). Comparison of greenhouse gas emissions from corn- and barley-based dairy production systems in Eastern Canada. Agricultural Systems, 152, 38-46. DOI: 10.1016/j.agsy.2016.12.002

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Thivierge, M., Jégo, G., Bélanger, G., Chantigny, M. H., Rotz, C. A., Charbonneau, É., . . . Qian, B. (2017). Projected impact of future climate conditions on the agronomic and environmental performance of Canadian dairy farms. Agricultural Systems, 157, 241-257. DOI: 10.1016/j.agsy.2017.07.003

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