Empowering FarmersThe Canadian Supply Management Experience

Bruce Saunders1st Vice-President, Dairy Farmers of Canada

Chapeco, Brazil, January, 2005

Outline of the presentationWho we are?History of supply management in CanadaDetermining production quotaBenefits of supply managementExpectations from the Doha Round of negotiationsConclusion

Economic Snapshot of the Canadian Dairy Industry16,000 dairy producers Milk sales: $4.2B Adds a net $8.3 billion to the GDPProcessed products sales: over $10BSupports $26 B of economic activitySustains more than 142,600 jobs:On-farm: 50,800Farm suppliers: 25,200Processing sector: 66,600

Brief History When Canada was a major exporter, producers received low returns.

SoCanada turned its attention to the domestic market.

Objectives of the Canadian Dairy System1) Ensure orderly marketing of milk by balancing supply with demand2) Balance the negotiating power between stakeholders to obtain fair prices for the producer3) Ensure that consumers have access to adequate supplies of high quality products

Pillars of Supply Management Depends on three pillars: Import controls Producer pricingProduction discipline

All equally important

Producers Need Market PowerLegislation is necessary

Canada uses legislation for management of supply

Fundamentals of the Canadian System Balancing Supply With Demand

Balancing Supply with DemandCanadian Milk Supply Management Committee

Balancing Supply with Demand Prevents Market Price Volatility

Balancing Supply with DemandMarket Stability

Chart4

3.98024234825.033526.43795

3.84147632224.617215.81173

4.80445498445.557396.44797

6.04077875126.352356.26254

7.42848713746.923036.53387

8.65219231097.163226.33409

7.9625395036.641546.41805

7.52520081086.30246.29138

6.6252958655.737936.12417

5.76744327185.134536.26486

4.64046139684.410486.11864

4.39655967674.480956.43672

1960

1976

2003

million hl

Canadian Milk Production 1960, 1976, 2003

Chart1

4.3864

4.24223

5.24271

6.52718

7.96893

9.24029

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9.1966

8.633

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6.29999

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6.48349

5.91116

4.99368

5.13786

4.62669

4.25097

5.12038

7.74611

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6.6932

6.23446

5.38689

5.57475

5.40463

4.98365

6.0454

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7.57773

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5.61723

4.83937

4.92775

4.87914

4.6227

5.62476

6.33107

7.26175

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6.77349

6.06418

5.29856

5.27583

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4.66235

5.52091

6.49076

7.3049

7.74493

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6.99571

6.34919

5.76954

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5.38706

5.3429536082

4.8631106489

5.7256224594

6.2464199446

7.1825632035

7.4558995717

7.1022023319

7.2117515602

6.4723819998

6.0867716063

5.4404889584

5.5640027717

5.5237191239

5.2796227184

6.0575213224

6.6516096565

7.4388179839

7.8101025503

7.6340744659

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6.6708586965

6.1694650693

5.4432240767

5.762200796

5.6622296424

5.2971687602

6.2753605924

6.8242936717

7.5142453214

7.9115083509

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7.305880914

6.6889311196

6.2650290701

5.6962070363

5.9883692752

5.9427908513

5.5720842721

6.5604321662

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7.6691355859

8.0057202743

7.8178847359

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6.8509739765

6.5595858277

6.0468285581

6.2306181857

6.1861234879

5.6360653976

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7.2057033363

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6.4438335576

6.2244048227

5.7706538597

6.0831385435

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6.5696386775

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6.6445396337

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6.2542846998

6.3226110509

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6.9966267661

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7.2972317475

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6.2687963085

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5.9774081597

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6.9030134723

6.8014425325

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6.4065533793

6.3426135386

6.1125642878

6.4533084202

6.5527325502

6.1301619356

6.541327623

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6.5728176075

6.3814728607

6.16483085

6.2649155369

5.954226742

5.9664780077

5.7061153893

6.0699377273

6.1022121231

5.6054011092

6.2553787471

6.2590118099

6.5778440324

6.438311715

6.3160364458

6.2272328318

5.9542370632

5.8976768813

5.7621285476

6.1599179583

6.2561115524

5.7604874766

6.4958111262

6.4939739524

6.8052820193

6.6518160805

6.5107046194

6.4258953101

6.1373248492

6.2115446061

5.9886582688

6.3699647215

6.5110658614

5.9623495273

6.6320922652

6.5012813628

6.8150458755

6.6543963808

6.5871537557

6.595637783

6.352284504

6.3785829244

6.1999229337

6.5771628331

6.6540454599

6.2864455623

6.7851350348

6.6502782215

6.8281434797

6.6156505919

6.4566112045

6.3728030518

6.1438994543

6.1964137253

6.0479122842

6.4727845266

6.6403905109

6.1232983369

6.8358534169

6.7668252241

7.0720644248

6.9438441438

6.8943643058

6.7660717764

6.4610080362

6.5495329778

6.3219814577

6.7066526218

6.8324990266

6.2823480455

6.951812111

6.8210321722

7.1662350634

6.9145009691

6.9167200274

6.7905020594

6.5366934037

6.6371496538

6.4345754402

6.826564336

6.9213955315

6.3764567569

7.1036885849

6.9817229518

7.2675582944

6.9336880819

6.9031889328

6.832519669

6.5252987977

6.633929439

6.4798958341

6.8577962904

6.9528751947

6.5597406457

7.0484391955

6.8371435671

7.0518658343

6.7730901932

6.739412114

6.6830067502

6.4750964756

6.6326599313

6.4046542783

6.7210816609

6.8918356116

6.3219195304

7.0255261291

6.8920213932

7.2120818386

6.8033829183

6.8472170593

6.7894596181

6.5704437312

6.7189658147

6.5630124664

6.8396103341

7.0341649744

6.3990395449

7.0337521264

6.8303006107

6.8725040019

6.5761410342

6.5422668523

6.4600791281

6.2425185306

6.4644346749

6.3716161136

6.7841441995

6.9351020865

6.2887678326

6.94544393

6.7540578984

7.0341030472

6.8279060921

6.9145628963

6.7838242423

6.6112434391

6.756452417

6.6055358149

6.9338325788

7.0191785905

6.6331243853

7.1371808824

6.9529990492

7.1852776794

6.9159562585

6.9616998217

6.8911853759

6.6284385601

Month/Year

In Million Hectolitre

Evolution of milk production per month since 1946

Sheet1

v382152 Table 003-0011: Milk production and utilization; Canada; Milk production, total (Kilolitres) [D230975]

v382155 Table 003-0011: Milk production and utilization; Canada; Milk sold off farms, total (Kilolitres) [D230978]

Milk productionMilk sold off farms

Monthlyv382152v382155In HectolitreIn hectolitre

Jan-46363,058325,2753.633.25J

Feb-46347,330310,1373.473.10F

Mar-46421,165381,2044.213.8110.17M

Apr-46550,048505,2565.505.05A

May-46730,485678,9307.306.79M

Jun-46886,893829,4758.878.2920.14J

Jul-46842,766787,0028.437.87J

Aug-46731,796680,1927.326.80A

Sep-46630,436582,6316.305.8320.50S

Oct-46557,475512,4055.575.12O

Nov-46424,223384,1484.243.84N

Dec-46377,475339,1523.773.3912.36D

Jan-47366,990329,0603.673.29

Feb-47344,708307,6133.453.08

Mar-47418,980379,1014.193.7910.16

Apr-47548,737503,9945.495.04

May-47709,077658,3247.096.58

Jun-47875,533818,5418.768.1919.81

Jul-47846,262790,3678.467.90

Aug-47747,087694,9107.476.95

Sep-47702,961652,4387.036.5221.38

Oct-47601,165554,4576.015.54

Nov-47427,281387,0914.273.87

Dec-47366,553328,6393.673.2912.70

Jan-48353,009315,6033.533.16

Feb-48335,097298,3623.352.98

Mar-48404,999365,6444.053.669.80

Apr-48502,864459,8415.034.60

May-48673,252623,8426.736.24

Jun-48867,669810,9728.688.1118.95

Jul-48819,174764,2958.197.64

Aug-48733,106681,4537.336.81

Sep-48647,038598,6116.475.9920.44

Oct-48546,990502,3135.475.02

Nov-48432,961392,5584.333.93

Dec-48385,339346,7213.853.4712.42

Jan-49348,640311,3983.493.11

Feb-49324,611288,2693.252.88

Mar-49408,932369,4304.093.699.69

Apr-49530,388486,3335.304.86

May-49711,699660,8487.126.61

Jun-49835,339779,8548.357.8019.27

Jul-49781,165727,7107.817.28

Aug-49729,611678,0897.306.78

Sep-49658,398609,5456.586.1020.15

Oct-49583,252537,2165.835.37

Nov-49451,747410,6404.524.11

Dec-49394,514355,5523.953.5613.03

Jan-50355,631318,1273.563.18

Feb-50326,796290,3733.272.90

Mar-50419,854379,9424.203.809.88

Apr-50515,970472,4565.164.72

May-50660,582611,6476.616.12

Jun-50816,116761,3518.167.6118.45

Jul-50758,446705,8437.587.06

Aug-50710,388659,5867.106.60

Sep-50625,631578,0066.265.7819.43

Oct-50524,271480,4455.244.80

Nov-50410,679371,1114.113.71

Dec-50362,184324,4343.623.2411.76

Jan-51342,961305,9323.433.06

Feb-51311,067275,2333.112.75

Mar-51391,893353,0293.923.539.34

Apr-51490,631448,0664.914.48

May-51672,815623,4226.736.23

Jun-51802,135747,8948.027.4818.19

Jul-51756,699704,1617.577.04

Aug-51720,873669,6787.216.70

Sep-51630,873583,0526.315.8319.57

Oct-51562,718517,4515.635.17

Nov-51417,233377,4204.173.77

Dec-51369,174331,1623.693.3112.26

Jan-52346,893309,7163.473.10

Feb-52328,543292,0543.292.92

Mar-52403,689364,3834.043.649.66

Apr-52523,398479,6055.234.80

May-52695,533645,2886.966.45

Jun-52810,436755,8848.107.5618.81

Jul-52769,368716,3557.697.16

Aug-52718,689667,5767.196.68

Sep-52651,844603,2376.526.0319.87

Oct-52567,087521,6575.675.22

Nov-52429,466389,1944.293.89

Dec-52407,184367,7474.073.6812.79

Jan-53383,155344,6193.833.45

Feb-53348,640311,3983.493.11

Mar-53440,825400,1274.414.0010.56

Apr-53565,339519,9745.655.20

May-53723,932672,6237.246.73

Jun-53857,621801,3008.588.0119.94

Jul-53802,135747,8948.027.48

Aug-53737,038685,2377.376.85

Sep-53650,097601,5556.506.0220.35

Oct-53586,310540,1595.865.40

Nov-53449,126408,1174.494.08

Dec-53421,165381,2044.213.8113.29

Jan-54384,029345,4603.843.45

Feb-54362,184324,4343.623.24

Mar-54470,097428,3024.704.2810.98

Apr-54579,320533,4315.795.33

May-54729,611678,0897.306.78

Jun-54872,912816,0188.738.1620.28

Jul-54837,524781,9578.387.82

Aug-54769,805716,7767.707.17

Sep-54688,980638,9816.896.3921.38

Oct-54584,563538,4785.855.38

Nov-54467,475425,7784.674.26

Dec-54423,786383,7274.243.8413.48

Jan-55391,456352,6093.913.53

Feb-55364,805326,9573.653.27

Mar-55462,233420,7334.624.2111.00

Apr-55584,126538,0575.845.38

May-55762,815710,0487.637.10

Jun-55892,572834,9418.938.3520.83

Jul-55797,766743,6897.987.44

Aug-55785,533731,9157.867.32

Sep-55739,223687,3407.396.8721.63

Oct-55632,184584,3146.325.84

Nov-55487,135444,7014.874.45

Dec-55447,378406,4354.474.0614.35

Jan-56410,242370,6914.103.71

Feb-56391,456352,6093.913.53

Mar-56486,699444,2824.874.4411.68

Apr-56594,174547,7285.945.48

May-56713,883662,9507.146.63

Jun-56889,951832,4198.908.3220.43

Jul-56860,242803,8238.608.04

Aug-56796,456742,4287.967.42

Sep-56681,553631,8326.826.3221.78

Oct-56616,456569,1756.165.69

Nov-56473,592431,6664.744.32

Dec-56424,223384,1484.243.8413.85

Jan-57391,019352,1883.913.52

Feb-57361,310323,5933.613.24

Mar-57436,019395,5014.363.9610.71

Apr-57577,135531,3285.775.31

May-57760,194707,5257.607.08

Jun-57876,844819,8038.778.2020.59

Jul-57870,291813,4968.708.13

Aug-57812,621757,9878.137.58

Sep-57703,834653,2787.046.5322.25

Oct-57643,980595,6676.445.96

Nov-57506,359463,2055.064.63

Dec-57449,563408,5384.504.0914.67

Jan-58431,213390,8764.313.91

Feb-58387,524348,8243.883.49

Mar-58489,757447,2254.904.4711.87

Apr-58623,446575,9036.235.76

May-58790,339736,5407.907.37

Jun-58912,233853,8659.128.5421.66

Jul-58891,262833,6808.918.34

Aug-58802,135747,8948.027.48

Sep-58745,339693,2277.456.9322.75

Oct-58671,067621,7396.716.22

Nov-58501,990459,0005.024.59

Dec-58468,786427,0404.694.2715.08

Jan-59430,776390,4554.313.90

Feb-59394,514355,5523.953.56

Mar-59486,699444,2824.874.4411.90

Apr-59623,883576,3246.245.76

May-59769,368716,3557.697.16

Jun-59924,466865,6409.248.6621.58

Jul-59862,427805,9268.628.06

Aug-59789,466735,7007.897.36

Sep-59751,019698,6947.516.9922.40

Oct-59667,572618,3756.686.18

Nov-59503,300460,2615.034.60

Dec-59485,388443,0204.854.4315.22

Jan-60438,640398,0244.393.98

Feb-60424,223384,1484.243.84

Mar-60524,271480,4455.244.8012.63

Apr-60652,718604,0786.536.04

May-60796,893742,8497.977.43

Jun-60924,029865,2199.248.6522.12

Jul-60852,378796,2548.527.96

Aug-60806,941752,5208.077.53

Sep-60713,446662,5307.136.6322.11

Oct-60624,320576,7446.245.77

Nov-60507,233464,0465.074.64

Dec-60481,893439,6564.824.4014.80

Jan-61442,572401,8094.434.02

Feb-61413,737374,0554.143.74

Mar-61532,135488,0155.324.8812.64

Apr-61651,844603,2376.526.03

May-61803,009748,7358.037.49

Jun-61945,873886,2449.468.8622.38

Jul-61889,514831,9988.908.32

Aug-61839,271783,6388.397.84

Sep-61758,446705,8437.587.0623.21

Oct-61692,038641,9246.926.42

Nov-61545,242500,6305.455.01

Dec-61489,320446,8054.894.4715.89

Jan-62461,359419,8924.614.20

Feb-62417,669377,8394.183.78

Mar-62532,135488,0155.324.8812.86

Apr-62636,990588,9396.375.89

May-62803,883749,5778.047.50

Jun-62955,485895,4969.558.9522.34

Jul-62887,330829,8968.878.30

Aug-62850,194794,1528.507.94

Sep-62755,388702,8997.557.0323.27

Oct-62684,611634,7756.856.35

Nov-62538,689494,3235.394.94

Dec-62496,747453,9534.974.5415.83

Jan-63467,475425,7784.674.26

Feb-63422,475382,4654.223.82

Mar-63526,456482,5495.264.8312.91

Apr-63663,640614,5906.646.15

May-63793,398739,4857.937.39

Jun-63935,388876,1529.358.7622.30

Jul-63899,999842,0909.008.42

Aug-63854,563798,3578.557.98

Sep-63753,640701,2177.547.0123.42

Oct-63681,553631,8326.826.32

Nov-63539,999495,5845.404.96

Dec-63502,864459,8415.034.6015.87

Jan-64471,844429,9844.724.30

Feb-64446,941406,0144.474.06

Mar-64538,252493,9025.384.9413.30

Apr-64657,087608,2836.576.08

May-64811,747757,1468.127.57

Jun-64954,611894,6559.558.9522.60

Jul-64887,766830,3158.888.30

Aug-64832,281776,9108.327.77

Sep-64758,446705,8437.587.0623.13

Oct-64672,815623,4226.736.23

Nov-64526,893482,9695.274.83

Dec-64514,223470,7745.144.7115.77

Jan-65462,233420,7334.624.21

Feb-65432,524392,1374.333.92

Mar-65565,776520,3955.665.2013.33

Apr-65672,815623,4226.736.23

May-65782,475728,9717.827.29

Jun-65938,446879,0969.388.7922.31

Jul-65892,135834,5218.928.35

Aug-65820,048765,1368.207.65

Sep-65752,766700,3767.537.0023.00

Oct-65645,291596,9296.455.97

Nov-65530,825486,7545.314.87

Dec-65511,165467,8315.114.6815.52

Jan-66462,233420,7334.624.21

Feb-66433,834393,3984.343.93

Mar-66551,796506,9395.525.0713.21

Apr-66675,873626,3656.766.26

May-66789,029735,2797.897.35

Jun-66943,252883,7229.438.8422.45

Jul-66854,563798,3578.557.98

Aug-66820,485765,5568.207.66

Sep-66759,320706,6847.597.0722.71

Oct-66661,893612,9096.626.13

Nov-66538,689494,3235.394.94

Dec-66522,961479,1855.234.7915.86

Jan-67474,902432,9274.754.33

Feb-67432,961392,5584.333.93

Mar-67541,747497,2665.424.9713.23

Apr-67661,456612,4886.616.12

May-67777,669724,3457.787.24

Jun-67919,660861,0149.208.6121.98

Jul-67863,300806,7678.638.07

Aug-67823,980768,9208.247.69

Sep-67751,456699,1157.516.9922.75

Oct-67663,203614,1706.636.14

Nov-67533,883489,6975.344.90

Dec-67505,485462,3645.054.6215.66

Jan-68471,844429,9844.724.30

Feb-68444,320403,4914.444.03

Mar-68521,650477,9235.224.7813.11

Apr-68670,631621,3196.716.21

May-68795,582741,5877.967.42

Jun-68900,436842,5119.008.4322.05

Jul-68865,922809,2908.668.09

Aug-68832,718777,3318.337.77

Sep-68733,543681,8737.346.8222.68

Oct-68698,592648,2326.996.48

Nov-68556,165511,1445.565.11

Dec-68515,533472,0355.164.7216.31

Jan-69489,320446,8054.894.47

Feb-69444,757403,9124.454.04

Mar-69565,339519,9745.655.2013.71

Apr-69690,291640,2436.906.40

May-69799,514745,3718.007.45

Jun-69917,912859,3329.188.5922.45

Jul-69886,456829,0558.868.29

Aug-69821,359766,3988.217.66

Sep-69767,621714,6747.687.1523.10

Oct-69680,242630,5706.806.31

Nov-69544,805500,2105.455.00

Dec-69551,359506,5185.515.0716.37

Jan-70510,728467,4105.114.67

Feb-70470,097428,3024.704.28

Mar-70574,514528,8055.755.2914.25

Apr-70682,427632,6736.826.33

May-70777,233723,9267.777.24

Jun-70905,242847,1369.058.4722.04

Jul-70846,262790,3678.467.90

Aug-70762,815710,0487.637.10

Sep-70726,553675,1457.276.7521.76

Oct-70663,640614,5906.646.15

Nov-70533,009488,8565.334.89

Dec-70530,388486,3335.304.8615.90

Jan-71478,834436,7124.794.37

Feb-71449,563408,5384.504.09

Mar-71566,213520,8155.665.2113.66

Apr-71664,077615,0116.646.15

May-71733,980682,2947.346.82

Jun-71871,165814,3378.718.1421.12

Jul-71807,378752,9418.077.53

Aug-71743,155691,1257.436.91

Sep-71694,223644,0276.946.4420.88

Oct-71645,291596,9296.455.97

Nov-71552,669507,7795.535.08

Dec-71539,126494,7445.394.9515.99

Jan-72491,504448,9074.924.49

Feb-72486,699444,2824.874.44

Mar-72570,145524,6005.705.2514.18

Apr-72660,582611,6476.616.12

May-72760,194707,5257.607.08

Jun-72855,873799,6188.568.0021.19

Jul-72782,038728,5517.827.29

Aug-72743,592691,5467.446.92

Sep-72698,592648,2326.996.4820.68

Oct-72619,077571,6986.195.72

Nov-72516,407472,8765.164.73

Dec-72516,844473,2975.174.7315.18

Jan-73488,446445,9634.884.46

Feb-73453,495412,3224.534.12

Mar-73552,233507,3595.525.0713.66

Apr-73620,825573,3806.215.73

May-73717,815666,7357.186.67

Jun-73801,262747,0548.017.4719.87

Jul-73737,475685,6587.376.86

Aug-73699,466649,0746.996.49

Sep-73649,660601,1346.506.0119.36

Oct-73618,640571,2776.195.71

Nov-73512,475469,0925.124.69

Dec-73502,427459,4205.024.5915.00

Jan-74499,805456,8975.004.57

Feb-74460,048418,6304.604.19

Mar-74538,689494,3235.394.9413.70

Apr-74629,999582,2106.305.82

May-74690,728640,6636.916.41

Jun-74779,417726,0287.797.2619.49

Jul-74766,310713,4127.667.13

Aug-74706,019655,3817.066.55

Sep-74648,349599,8736.486.0019.69

Oct-74591,116544,7855.915.45

Nov-74499,368456,4764.994.56

Dec-74513,786470,3545.144.7014.72

Jan-75462,669421,1534.634.21

Feb-75425,097384,9894.253.85

Mar-75512,038468,6715.124.6912.75

Apr-75774,611721,4027.757.21

May-75730,485678,9307.306.79

Jun-75814,368759,6698.147.6021.60

Jul-75774,611721,4027.757.21

Aug-75734,854683,1357.356.83

Sep-75669,320620,0586.696.2020.25

Oct-75623,446575,9036.235.76

Nov-75538,689494,3235.394.94

Dec-75557,475512,4055.575.1215.83

Jan-76540,463503,3525.405.03

Feb-76498,365461,7214.984.62

Mar-76604,540555,7396.055.5615.21

Apr-76691,873635,2356.926.35

May-76757,773692,3037.586.92

Jun-76788,557716,3227.897.1620.44

Jul-76732,601664,1547.336.64

Aug-76691,399630,2406.916.30

Sep-76627,208573,7936.275.7418.68

Oct-76561,723513,4535.625.13

Nov-76483,937441,0484.844.41

Dec-76492,775448,0954.934.4814.03

Jan-77487,914441,3804.884.41

Feb-77462,270418,3854.624.18

Mar-77562,476508,0915.625.0813.68

Apr-77633,107579,0926.335.79

May-77726,175673,1727.266.73

Jun-77794,482747,9237.947.4820.00

Jul-77775,272732,6227.757.33

Aug-77744,378703,8297.447.04

Sep-77677,349639,6376.776.4020.76

Oct-77606,418569,5816.065.70

Nov-77529,856489,0485.304.89

Dec-77527,583482,0035.284.8215.41

Jan-78515,518468,9755.164.69

Feb-78466,235423,2924.664.23

Mar-78552,091499,5135.525.0013.92

Apr-78649,076596,1876.495.96

May-78730,490677,8487.306.78

Jun-78774,493728,8517.747.2920.03

Jul-78730,068689,7747.306.90

Aug-78699,571656,8837.006.57

Sep-78634,919597,0226.355.9719.44

Oct-78576,954541,0425.775.41

Nov-78531,398493,9365.314.94

Dec-78538,706494,6535.394.9515.30

Jan-79534,295489,5355.344.90

Feb-79486,311443,0444.864.43

Mar-79572,562526,6115.735.2714.59

Apr-79624,642577,0706.255.77

May-79718,256667,7717.186.68

Jun-79745,590694,2547.466.9419.39

Jul-79710,220659,9857.106.60

Aug-79721,175670,5997.216.71

Sep-79647,238598,9636.475.9919.30

Oct-79608,677561,6026.095.62

Nov-79544,049498,9855.444.99

Dec-79556,400510,9525.565.1115.72

Jan-80552,372507,0495.525.07

Feb-80527,962483,3995.284.83

Mar-80605,752558,7686.065.5915.49

Apr-80665,161616,3286.656.16

May-80743,882692,5997.446.93

Jun-80781,010728,5727.817.2920.37

Jul-80763,407711,5177.637.12

Aug-80722,597671,9777.236.72

Sep-80667,086618,1936.676.1820.02

Oct-80616,947569,6146.175.70

Nov-80544,322499,2505.444.99

Dec-80576,220530,1555.765.3015.99

Jan-81566,223520,4695.665.20

Feb-81529,717485,0995.304.85

Mar-81627,536579,8746.285.8015.85

Apr-81682,429633,0596.826.33

May-81751,425699,9077.517.00

Jun-81791,151738,3977.917.3820.71

Jul-81769,047716,9817.697.17

Aug-81730,588679,7197.316.80

Sep-81668,893619,9446.696.2020.17

Oct-81626,503578,8736.275.79

Nov-81569,621523,7615.705.24

Dec-81598,837552,0685.995.5216.55

Jan-82594,279547,6525.945.48

Feb-82557,208511,7355.575.12

Mar-82656,043607,4946.566.0716.67

Apr-82698,910649,0276.996.49

May-82766,914714,9147.677.15

Jun-82800,572747,5258.017.4821.11

Jul-82781,788729,3267.827.29

Aug-82747,783696,3797.486.96

Sep-82685,097635,6446.856.3620.61

Oct-82655,959607,4126.566.07

Nov-82604,683557,7326.055.58

Dec-82623,062575,5396.235.7617.41

Jan-83618,612571,2286.195.71

Feb-83563,607517,9345.645.18

Mar-83644,839596,6386.455.9716.86

Apr-83672,287623,2326.726.23

May-83720,570670,0137.216.70

Jun-83731,050680,1677.316.8019.73

Jul-83710,913660,6567.116.61

Aug-83700,476650,5447.006.51

Sep-83644,383596,1976.445.9619.07

Oct-83622,440574,9376.225.75

Nov-83577,065530,9745.775.31

Dec-83608,314561,2506.085.6116.67

Jan-84615,781568,4856.165.68

Feb-84591,274544,7405.915.45

Mar-84656,964608,3866.576.0817.22

Apr-84686,099636,6146.866.37

May-84749,173697,7267.496.98

Jun-84764,237712,3217.647.1220.47

Jul-84745,946694,5997.466.95

Aug-84716,827666,3867.176.66

Sep-84664,454615,6436.646.1619.77

Oct-84643,684595,5196.445.96

Nov-84595,383548,7225.955.49

Dec-84625,428577,8326.255.7817.22

Jan-85632,261584,4526.325.84

Feb-85578,046531,9245.785.32

Mar-85651,420603,0156.516.0317.19

Apr-85678,971629,7086.796.30

May-85719,432668,9107.196.69

Jun-85716,661666,2257.176.6619.65

Jul-85699,663649,7567.006.50

Aug-85695,592645,8126.966.46

Sep-85646,040597,8026.465.9818.93

Oct-85629,664581,9366.305.82

Nov-85587,134540,7295.875.41

Dec-85610,372563,2446.105.6316.86

Jan-86623,539576,0016.245.76

Feb-86573,602527,6185.745.28

Mar-86654,897606,3836.556.0617.10

Apr-86683,671634,2626.846.34

May-86733,733682,7667.346.83

Jun-86730,728679,8557.316.8019.97

Jul-86717,173666,7217.176.67

Aug-86698,347648,4816.986.48

Sep-86647,744599,4536.485.9919.15

Oct-86622,685575,1746.235.75

Nov-86582,133535,8845.825.36

Dec-86620,004572,5766.205.7316.84

Jan-87632,154584,3486.325.84

Feb-87580,890534,6805.815.35

Mar-87665,749616,8986.666.1717.36

Apr-87691,606641,9506.926.42

May-87737,730686,6397.386.87

Jun-87729,723678,8817.306.7920.07

Jul-87706,629656,5067.076.57

Aug-87697,863648,0126.986.48

Sep-87645,929597,6956.465.9819.02

Oct-87636,663588,7176.375.89

Nov-87600,350553,5346.005.54

Dec-87637,992590,0056.385.9017.32

Jan-88648,905600,5786.496.01

Feb-88623,974576,4236.245.76

Mar-88688,324638,7706.886.3918.16

Apr-88702,655652,6557.036.53

May-88746,588695,2217.476.95

Jun-88746,548695,1827.476.9520.43

Jul-88733,986683,0117.346.83

Aug-88711,432661,1597.116.61

Sep-88670,936621,9236.716.2219.66

Oct-88651,101602,7066.516.03

Nov-88619,648572,2316.205.72

Dec-88656,505607,9416.576.0817.83

Jan-89664,790615,9696.656.16

Feb-89610,724563,5856.115.64

Mar-89691,483641,8316.916.4218.21

Apr-89694,293644,5536.946.45

May-89732,364681,4407.326.81

Jun-89705,879655,7797.066.5619.82

Jul-89686,676637,1736.876.37

Aug-89674,730625,5996.756.26

Sep-89635,533587,6226.365.8818.50

Oct-89626,880579,2386.275.79

Nov-89598,330551,5775.985.52

Dec-89630,302582,5546.305.8317.13

Jan-90648,321600,0126.486.00

Feb-90600,365553,5496.005.54

Mar-90680,357631,0516.806.3117.85

Apr-90685,646636,1766.866.36

May-90726,088675,3597.266.75

Jun-90717,312666,8567.176.6719.78

Jul-90698,744648,8666.996.49

Aug-90682,233632,8696.826.33

Sep-90638,792590,7806.395.9118.73

Oct-90626,045578,4296.265.78

Nov-90597,741551,0065.985.51

Dec-90628,275580,5906.285.8117.10

Jan-91640,724592,6526.415.93

Feb-91590,920544,3975.915.44

Mar-91664,163615,3616.646.1517.52

Apr-91671,770622,7316.726.23

May-91707,715657,5587.086.58

Jun-91690,301640,6866.906.4119.21

Jul-91680,144630,8456.806.31

Aug-91673,411624,3216.736.24

Sep-91640,655592,5856.415.9318.48

Oct-91634,261586,3906.345.86

Nov-91611,256564,1016.115.64

Dec-91645,331597,1156.455.9717.48

Jan-92655,273606,7486.556.07

Feb-92613,016565,8066.135.66

Mar-92654,133605,6436.546.0617.78

Apr-92643,089594,9436.435.95

May-92657,282608,6946.576.09

Jun-92638,147590,1556.385.9017.94

Jul-92616,483569,1656.165.69

Aug-92626,492578,8626.265.79

Sep-92595,423548,7605.955.4916.97

Oct-92596,648549,9475.975.50

Nov-92570,612524,7215.715.25

Dec-92606,994559,9716.075.6016.35

Jan-93610,221563,0986.105.63

Feb-93560,540514,9635.615.15

Mar-93625,538577,9386.265.7816.56

Apr-93625,901578,2906.265.78

May-93657,784609,1816.586.09

Jun-93643,831595,6626.445.9617.83

Jul-93631,604583,8156.325.84

Aug-93622,723575,2116.235.75

Sep-93595,424548,7615.955.4917.08

Oct-93589,768543,2815.905.43

Nov-93576,213530,1485.765.30

Dec-93615,992568,6896.165.6916.42

Jan-94625,611578,0096.265.78

Feb-94576,049529,9895.765.30

Mar-94649,581601,2336.506.0117.09

Apr-94649,397601,0556.496.01

May-94680,528631,2176.816.31

Jun-94665,182616,3486.656.1618.49

Jul-94651,070602,6766.516.03

Aug-94642,590594,4596.435.94

Sep-94613,732566,5006.145.6717.64

Oct-94621,154573,6916.215.74

Nov-94598,866552,0965.995.52

Dec-94636,996589,0406.375.8917.15

Jan-95651,107602,7116.516.03

Feb-95596,235549,5475.965.50

Mar-95663,209614,4376.636.1417.67

Apr-95650,128601,7636.506.02

May-95681,505632,1636.826.32

Jun-95665,440616,5986.656.1718.51

Jul-95658,715610,0836.596.10

Aug-95659,564610,9056.606.11

Sep-95635,228587,3276.355.8718.08

Oct-95637,858589,8756.385.90

Nov-95619,992572,5656.205.73

Dec-95657,716609,1156.586.0917.72

Jan-96665,405616,5646.656.17

Feb-96628,645580,9486.295.81

Mar-96678,514629,2656.796.2918.27

Apr-96665,028616,1996.656.16

May-96682,814633,4326.836.33

Jun-96661,565612,8446.626.1318.62

Jul-96645,661597,4356.465.97

Aug-96637,280589,3156.375.89

Sep-96614,390567,1376.145.6717.54

Oct-96619,641572,2256.205.72

Nov-96604,791557,8376.055.58

Dec-96647,278599,0026.475.9917.29

Jan-97664,039615,2416.646.15

Feb-97612,330565,1416.125.65

Mar-97683,585634,1796.846.3418.15

Apr-97676,683627,4916.776.27

May-97707,206657,0657.076.57

Jun-97694,384644,6426.946.4519.29

Jul-97689,436639,8486.896.40

Aug-97676,607627,4186.776.27

Sep-97646,101597,8616.465.9818.65

Oct-97654,953606,4386.556.06

Nov-97632,198584,3916.325.84

Dec-97670,665621,6616.716.2218.12

Jan-98683,250633,8546.836.34

Feb-98628,235580,5516.285.81

Mar-98695,181645,4146.956.4518.60

Apr-98682,103632,7436.826.33

May-98716,624666,1897.176.66

Jun-98691,450641,7996.916.4219.41

Jul-98691,672642,0146.926.42

Aug-98679,050629,7856.796.30

Sep-98653,669605,1946.546.0518.77

Oct-98663,715614,9276.646.15

Nov-98643,458595,3006.435.95

Dec-98682,656633,2796.836.3318.44

Jan-99692,140642,4676.926.42

Feb-99637,646589,6696.385.90

Mar-99710,369660,1297.106.6018.92

Apr-99698,172648,3126.986.48

May-99726,756676,0067.276.76

Jun-99693,369643,6586.936.4419.68

Jul-99690,319640,7036.906.41

Aug-99683,252633,8566.836.34

Sep-99652,530604,0906.536.0418.79

Oct-99663,393614,6156.636.15

Nov-99647,990599,6916.486.00

Dec-99685,780636,3056.866.3618.51

Jan-00695,288645,5176.956.46

Feb-00655,974607,4276.566.07

Mar-00704,844654,7767.056.5519.08

Apr-00683,714634,3046.846.34

May-00705,187655,1087.056.55

Jun-00677,309628,0986.776.2819.18

Jul-00673,941624,8356.746.25

Aug-00668,301619,3706.686.19

Sep-00647,510599,2266.485.9918.43

Oct-00663,266614,4926.636.14

Nov-00640,465592,4016.405.92

Dec-00672,108623,0596.726.2318.30

Jan-01689,184639,6036.896.40

Feb-01632,192584,3856.325.84

Mar-01702,553652,5567.036.5318.77

Apr-01689,202639,6216.896.40

May-01721,208670,6317.216.71

Jun-01680,338631,0336.806.3119.41

Jul-01684,722635,2806.856.35

Aug-01678,946629,6846.796.30

Sep-01657,044608,4646.576.0818.73

Oct-01671,897622,8546.726.23

Nov-01656,301607,7446.566.08

Dec-01683,961634,5436.846.3518.65

Jan-02703,416653,3937.036.53

Feb-02639,904591,8576.405.92

Mar-02703,375653,3537.036.5318.99

Apr-02683,030633,6416.836.34

May-02687,250637,7306.876.38

Jun-02657,614609,0166.586.0918.80

Jul-02654,227605,7346.546.06

Aug-02646,008597,7716.465.98

Sep-02624,252576,6926.245.7717.80

Oct-02646,443598,1936.465.98

Nov-02637,162589,2006.375.89

Dec-02678,414629,1696.786.2918.17

Jan-03693,510643,7956.946.44

Feb-03628,877581,1736.295.81

Mar-03694,544644,7976.956.4518.70

Apr-03675,406626,2546.756.26

May-03703,410653,3877.036.53

Jun-03682,791633,4096.836.3319.13

Jul-03691,456641,8056.916.42

Aug-03678,382629,1386.786.29

Sep-03661,124612,4176.616.1218.83

Oct-03675,645626,4866.766.26

Nov-03660,554611,8646.616.12

Dec-03693,383643,6726.936.4418.82

Jan-04701,918651,9417.026.52

Feb-04663,312614,5376.636.15

Mar-04713,718663,3747.146.6319.30

Apr-04695,300645,5296.956.46

May-04718,528668,0347.196.68

Jun-04691,596641,9406.926.4219.56

Jul-04696,170646,3726.966.46

Aug-04689,119639,5406.896.40

Sep-04662,844614,0836.636.1419.00

13.6613660648.0540624

21.1221116417.5595693

20.8820880928.2349504

15.9915994519.936524

14.1814177885.2537016

21.1921187903.6714775

20.6820683285.065175

15.1815178710.0707489

13.6613656451.4814501

19.8719871691.0223453

19.3619358660.020485

15.0014997891.6920891

13.7013698494.2089059

19.4919489013.6509647

19.6919686656.8207401

14.7214716143.8170688

12.7512748124.5148724

21.6021600005.1769774

20.2520245946.3730017

15.8315826310.5260343

15.2115208120

20.4420438600

18.6818681870

14.0314025960

13.6813678560

20.0020001870

20.7620760880

15.4115406320

13.9213917800

20.0320028860

19.4419436790

15.3015296310

14.5914591900

19.3919390950

19.3019295470

15.7215715390

15.4915492160

20.3720374990

20.0220016870

15.9915990190

15.8515854420

20.7120713630

20.1720166440

16.5516547020

16.6716668810

21.1121114660

20.6120613490

17.4117406830

16.8616858000

19.7319734120

19.0719073970

16.6716671610

17.2217216110

20.4720466610

19.7719766280

17.2217220730

17.1917193910

19.6519648430

18.9318933700

16.8616859090

17.1017100020

19.9719968830

19.1519146550

16.8416836340

17.3617359260

20.0720074700

19.0219022130

17.3217322560

18.1618157710

20.4320430580

19.6619660930

17.8317828780

18.2118213850

19.8219817720

18.5018503940

17.1317133690

17.8517846120

19.7819783910

18.7318725150

17.1017100250

17.5217524100

19.2119209750

18.4818477510

17.4817476060

17.7817781970

17.9417937920

16.9716967870

16.3516346390

16.5616559990

17.8317831330

17.0817077870

16.4216421180

17.0917092310

18.4918486200

17.6417636350

17.1517148270

17.6717666950

18.5118505240

18.0818083150

17.7217715550

18.2718267770

18.6218624750

17.5417538870

17.2917290640

18.1518145610

19.2919291980

18.6518651270

18.1218124900

18.6018598190

19.4119407310

18.7718769930

18.4418435060

18.9218922650

19.6819679760

18.7918786490

18.5118506110

19.0819077200

19.1819175100

18.4318434310

18.3018299520

18.7718765440

19.4119412850

18.7318734280

18.6518651410

18.9918986030

18.8018803870

17.8017801970

18.1718165620

18.7018697650

19.1319130500

18.8318833600

18.8218820220

19.3019298520

19.5619555030

19.0018999950

Sheet1

000

000

000

000

000

000

000

000

000

000

000

000

1960

1976

2003

Canadian Milk Production 1960, 1976, 2003

Sheet2

0

0

0

0

0

0

0

0

0

0

0

0

milk production, 1976

Sheet3

0

0

0

0

0

0

0

0

0

0

0

0

milk production, 1995

Chart2

0

0

0

0

0

0

0

0

0

0

0

0

milk production, 2003

Chart3

Table 002-00021,2 - Farm cash receipts, quarterly (Dollars x 1,000)

Farm cash receiptsHectolitres produced

1971I135,78013660648.05406249.94

II193,39721116417.55956939.16

III201,59320880928.23495049.65The net farm income accounts are designed to provide an annual measure of income returned to the operators of agricultural businesses from the production of agricultural commodities. An important component of these accounts is the farm cash receipts serie

IV174,92715994519.93652410.94

1972I159,73314177885.253701611.27These accounts only relate to the farm business and hence exclude any income that farm operators or their families may receive from other sources (wages and salaries, investment income, etc.). They pertain only to the production and marketing of agricultu

II221,35021187903.671477510.45

III221,23620683285.06517510.70

IV177,84815178710.070748911.72

1973I162,65713656451.481450111.91

II232,90919871691.022345311.72

III239,31819358660.02048512.36

IV216,33214997891.692089114.42

1974I204,58813698494.208905914.94

II295,99219489013.650964715.19

III322,07419686656.820740116.36

IV275,54514716143.817068818.72

1975I250,15212748124.514872419.62

II380,43121600005.176977417.61

III384,13620245946.373001718.97

IV334,95115826310.526034321.16

1976I312,0601520812020.52

II375,4332043860018.37

III350,1231868187018.74

IV296,4231402596021.13

1977I284,6471367856020.81

II392,7612000187019.64

III405,6182076088019.54

IV335,4321540632021.77

1978I306,7751391780022.04

II427,8922002886021.36

III416,6531943679021.44

IV358,3421529631023.43

1979I356,5271459190024.43

II457,1671939095023.58

III473,2431929547024.53

IV419,7641571539026.71

1980I432,6081549216027.92

II541,4142037499026.57

III552,1952001687027.59

IV489,2351599019030.60

1981I498,3651585442031.43

II627,5312071363030.30

III630,8712016644031.28

IV559,5801654702033.82

1982I575,1121666881034.50

II687,3132111466032.55

III675,0862061349032.75

IV609,4781740683035.01

1983I576,7361685800034.21

II643,3971973412032.60

III630,4161907397033.05

IV602,2391667161036.12

1984I626,9921721611036.42

II716,1602046661034.99

III697,0851976628035.27

IV656,1121722073038.10

1985I651,0181719391037.86

II702,9231964843035.78

III689,4581893370036.41

IV674,9151685909040.03

1986I674,3081710002039.43

II735,3061996883036.82

III719,5731914655037.58

IV683,0621683634040.57

1987I693,1131735926039.93

II748,7902007470037.30

III730,3581902213038.40

IV717,5961732256041.43

1988I743,6761815771040.96

II790,5242043058038.69

III774,5311966093039.39

IV779,2191782878043.71

1989I773,7661821385042.48

II805,8211981772040.66

III763,6321850394041.27

IV759,2091713369044.31

1990I769,5441784612043.12

II820,5521978391041.48

III781,0501872515041.71

IV783,6281710025045.83

1991I776,2671752410044.30

II811,7171920975042.26

III779,2861847751042.17

IV795,4421747606045.52

1992I799,6311778197044.97

II770,6221793792042.96

III749,0531696787044.15

IV770,3281634639047.13

1993I771,1271655999046.57

II792,4241783133044.44

III771,9901707787045.20

IV798,6331642118048.63

1994I823,6631709231048.19

II858,6821848620046.45

III820,9001763635046.55

IV851,2201714827049.64

1995I856,2541766695048.47

II870,8751850524047.06

III853,3421808315047.19

IV882,6141771555049.82

1996I894,5671826777048.97

II857,5031862475046.04

III848,9801753887048.41

IV913,6831729064052.84

1997I920,4231814561050.72

II945,0761929198048.99

III901,9521865127048.36

IV941,8161812490051.96

1998I939,6541859819050.52

II960,5191940731049.49

III952,6571876993050.75

IV993,2471843506053.88

1999I985,5321892265052.08

II988,4561967976050.23

III950,8561878649050.61

IV996,0911850611053.82

2000I1,008,0121907720052.84

II1,011,3801917510052.74

III984,7771843431053.42

IV1,025,6641829952056.05

2001I1,012,1401876544053.94

II1,044,9711941285053.83

III1,028,9141873428054.92

IV1,056,2881865141056.63

2002I1,046,3351898603055.11

II1,022,6391880387054.38

III998,2291780197056.07

IV1,068,0841816562058.80

2003I1,107,4341869765059.23

II1,139,5761913050059.57

III1,111,1501883360059.00

IV1,137,9661882022060.47

2004I1,132,5361929852058.69

II1,145,3301955503058.57

III1,145,2631899995060.28

Table 003-00081 - Cash receipts from milk and cream sold off farms, monthly (Dollars x 1,000)

(Dollars x 1000)Million hl producedPrice

1976January115,5005.0322.95

February105,9164.6222.94Footnotes:

March142,3605.5625.621. Receipts and supplementary payments are considered as accruing to milk and cream for month in which is produced. From January 1978 they are credited to month in which payment is made. From January 1986 the following were added for each fluid milk, indu

April142,0346.3522.36

May145,8066.9221.062. Includes return of contingency levy in Ontario in July 1979.

June164,6757.1622.99

July149,4046.6422.503. Includes return of following contingency levies in October 1979: Prince Edward Island equals 410; Nova Scotia equals 160; New Brunswick equals 178; Manitoba equals 890; Alberta equals 1340.

August141,7536.3022.49

September133,0995.7423.204. Beginning in January 1978, supplementary payments are credited to the month in which payment was made.

October133,7875.1326.06

November111,0384.4125.185. Includes return of contingency levy in Ontario of 3822 in March; 3518 in September and 6316 in October 1980.

December110,3804.4824.63

1977January106,2764.4124.086. Includes return of over quota levy for the dairy year 1980-1981 in Ontario in August 1981.

February99,2574.1823.72

March127,8815.0825.177. Includes year-end adjustments for the dairy year 1980-1981 applied in October 1981 in Prince Edward Island, Nova Scotia, New Brunswick, Quebec, Ontario, Manitoba and Saskatchewan.

April140,2325.7924.22

May161,4296.7323.988. Includes return of over quota levy for the dairy year 1981-1982 in Ontario in September 1982.

June177,6627.4823.75

July169,9207.3323.199. Includes return of over quota levy for the previous dairy year in October 1993, October 1994, September and October 1995 in Ontario and Prince Edward Island.

August165,8307.0423.56

September159,7806.4024.98

October143,0245.7025.11This survey collects monthly administrative data from provincial milk marketing agencies and provincial departments of agriculture in Canada related to off-farm sales of milk and cream. The data are used by Agriculture and Agri-Food Canada, the Canadian D

November123,9584.8925.35

December123,3334.8225.59

1978January120,9844.6925.80

February110,9784.2326.22

March121,3215.0024.29

April139,2655.9623.36

May160,1786.7823.63

June180,2517.2924.73

July174,0616.9025.23

August172,8626.5726.32

September158,4485.9726.54

October149,0695.4127.55

November137,2404.9427.78

December138,1224.9527.92

1979January137,8334.9028.16

February125,4164.4328.31

March142,6025.2727.08

April149,8855.7725.97

May175,6246.6826.30

June180,7466.9426.03

July188,8216.6028.61

August184,3706.7127.49

September183,4225.9930.62

October172,4985.6230.72

November156,2984.9931.32

December155,3035.1130.39

1980January155,5155.0730.67

February152,9104.8331.63

March175,1535.5931.35

April182,7736.1629.66

May203,8306.9329.43

June212,5307.2929.17

July210,4977.1229.58

August213,0076.7231.70

September206,7216.1833.44

October201,3075.7035.34

November174,0194.9934.86

December182,3025.3034.39

1981January182,1145.2034.99

February173,4904.8535.76

March197,7845.8034.11

April212,1686.3333.51

May232,9237.0033.28

June243,8937.3833.03

July245,1587.1734.19

August243,1816.8035.78

September224,9336.2036.28

October231,3635.7939.97

November201,0375.2438.38

December209,4355.5237.94

1982January207,5885.4837.91

February197,2535.1238.55

March227,8056.0737.50

April236,8576.4936.49

May253,2137.1535.42

June261,8287.4835.03

July256,8857.2935.22

August250,7096.9636.00

September242,9556.3638.22

October237,4216.0739.09

November222,1425.5839.83

December226,7695.7639.40

1983January213,6805.7137.41

February198,8875.1838.40

March222,5795.9737.31

April225,8356.2336.24

May238,1296.7035.54

June239,5276.8035.22

July224,8536.6134.03

August245,3466.5137.71

September233,1955.9639.11

October229,1675.7539.86

November217,1375.3140.89

December230,0485.6140.99

1984January227,2565.6839.98

February218,7165.4540.15

March239,7006.0839.40

April246,1836.3738.67

May266,4716.9838.19

June268,3077.1237.67

July259,4806.9537.36

August265,5726.6639.85

September251,3136.1640.82

October249,0995.9641.83

November242,4375.4944.18

December242,4645.7841.96

1985January243,7855.8441.71

February225,3635.3242.37

March245,4256.0340.70

April250,9136.3039.85

May262,7956.6939.29

June254,9746.6638.27

July248,2906.5038.21

August263,6886.4640.83

September251,2975.9842.04

October257,5085.8244.25

November250,3265.4146.29

December246,0235.6343.68

1986January248,5995.7643.16

February231,3985.2843.86

March255,9976.0642.22

April259,7326.3440.95

May274,1676.8340.16

June267,8916.8039.40

July267,2606.6740.09

August273,1866.4842.13

September255,2815.9942.59

October257,6795.7544.80

November246,1415.3645.93

December251,5625.7343.94

1987January254,6615.8443.58

February235,7535.3544.09

March264,7866.1742.92

April267,0526.4241.60

May279,5556.8740.71

June270,2016.7939.80

July270,8166.5741.25

August272,8016.4842.10

September262,2395.9843.88

October264,8565.8944.99

November264,1775.5447.73

December262,6735.9044.52

1988January268,1406.0144.65

February258,9795.7644.93

March281,5606.3944.08

April279,0006.5342.75

May294,3616.9542.34

June287,8606.9541.41

July277,9746.8340.70

August291,5706.6144.10

September281,6926.2245.29

October298,3966.0349.51

November271,2765.7247.41

December283,3506.0846.61

1989January284,4376.1646.18

February263,3965.6446.74

March293,9446.4245.80

April287,6166.4544.62

May296,2166.8143.47

June292,9946.5644.68

July273,5836.3742.94

August284,3436.2645.45

September272,5935.8846.39

October279,6405.7948.28

November269,2275.5248.81

December278,8215.8347.86

1990January279,5006.0046.58

February261,3185.5447.21

March293,3006.3146.48

April289,3026.3645.48

May305,0266.7545.17

June295,5996.6744.33

July283,8226.4943.74

August287,4986.3345.43

September273,9455.9146.37

October295,7805.7851.14

November273,0415.5149.55

December281,8725.8148.55

1991January284,6115.9348.02

February263,1425.4448.34

March291,3646.1547.35

April290,4486.2346.64

May301,1416.5845.80

June286,7116.4144.75

July268,2826.3142.53

August292,4106.2446.84

September274,7895.9346.37

October290,2825.8649.50

November280,5255.6449.73

December291,1265.9748.76

1992January294,2766.0748.50

February279,9155.6649.47

March291,0406.0648.05

April281,2565.9547.27

May281,5076.0946.25

June270,5505.9045.84

July254,9705.6944.80

August276,4015.7947.75

September259,9815.4947.38

October281,6975.5051.22

November268,1395.2551.10

December280,8815.6050.16

1993January280,3975.6349.80

February261,1915.1550.72

March289,3395.7850.06

April281,9115.7848.75

May290,6536.0947.71

June279,4255.9646.91

July268,9055.8446.06

August281,0045.7548.85

September278,5185.4950.75

October284,7025.4352.40

November277,2005.3052.29

December290,8595.6951.15

1994January295,7005.7851.16

February274,9815.3051.88

March307,9506.0151.22

April301,6296.0150.18

May312,3846.3149.49

June301,5646.1648.93

July285,4256.0347.36

August296,8965.9449.94

September291,8175.6751.51

October312,1315.7454.41

November290,6005.5252.64

December305,6925.8951.90

1995January309,8936.0351.42

February286,2945.5052.10

March318,2696.1451.80

April305,7456.0250.81

May316,4946.3250.07

June308,4076.1750.02

July275,7926.1045.21

August310,5156.1150.83

September312,0605.8753.13

October313,6155.9053.17

November303,7045.7353.04

December315,8496.0951.85

1996January323,6586.1752.49

February300,8625.8151.79

March322,1476.2951.19

April313,4426.1650.87

May308,5026.3348.70

June285,9386.1346.66

July261,9665.9743.85

August311,1715.8952.80

September307,8265.6754.28

October318,9315.7255.74

November305,3605.5854.74

December325,5875.9954.35

1997January324,9336.1552.81

February297,1345.6552.58

March336,1776.3453.01

April326,4966.2752.03

May333,6406.5750.78

June324,1756.4550.29

July299,0416.4046.74

August325,1976.2751.83

September310,3035.9851.90

October332,4976.0654.83

November314,2665.8453.78

December332,0186.2253.41

1998January330,3996.3452.13

February305,6795.8152.65

March340,6996.4552.79

April327,9186.3351.82

May339,0036.6650.89

June324,2736.4250.53

July316,3576.4249.28

August335,9326.3053.34

September334,2296.0555.23

October340,0636.1555.30

November333,7195.9556.06

December349,9186.3355.25

1999January346,1116.4253.87

February316,6605.9053.70

March354,6986.6053.73

April336,9906.4851.98

May349,1606.7651.65

June326,5086.4450.73

July324,3476.4150.62

August331,0066.3452.22

September319,5486.0452.90

October338,4886.1555.07

November331,0476.0055.20

December350,0276.3655.01

2000January341,3856.4652.89

February332,5206.0754.74

March358,1256.5554.69

April340,7776.3453.72

May347,4736.5553.04

June339,6756.2854.08

July328,0336.2552.50

August336,7926.1954.38

September336,3965.9956.14

October347,7086.1456.58

November339,5005.9257.31

December354,1136.2356.83

2001January339,1176.4053.02

February328,5625.8456.22

March360,9496.5355.31

April346,4916.4054.17

May361,5496.7153.91

June345,3926.3154.73

July340,7846.3553.64

August351,7456.3055.86

September345,2866.0856.75

October356,9576.2357.31

November350,3946.0857.65

December356,9716.3556.26

2002January362,3796.5355.46

February333,5945.9256.36

March357,5486.5354.73

April335,1226.3452.89

May349,2096.3854.76

June339,8806.0955.81

July332,7026.0654.93

August336,3325.9856.26

September329,1955.7757.08

October347,9195.9858.16

November347,3375.8958.95

December372,8286.2959.26

2003January364,0296.4456.54

February354,9075.8161.07

March388,2386.4560.21

April378,8816.2660.50

May389,9446.5359.68

June370,8886.3358.55

July370,2556.4257.69

August370,7276.2958.93

September369,8236.1260.39

October380,1346.2660.68

November370,2576.1260.51

December387,6606.4460.23

2004January380,4966.5258.36

February366,2276.1559.59

March385,8136.6358.16

April376,1606.4658.27

May387,3046.6857.98

June381,8666.4259.49

July376,9586.4658.32

August391,5506.4061.22

September376,7556.1461.35

9.9394991704

9.158608436

9.6544079713

10.9366833574

11.2663487637

10.4469986003

10.6963666218

11.7169376825

11.9106343416

11.7206431872

12.3623225857

14.4241607048

14.935072197

15.1876336741

16.3600149549

18.7239947791

19.6226511365

17.612542075

18.9734771061

21.1641872848

20.519301531

18.3688217393

18.7413251457

21.1338831709

20.8097197366

19.636214014

19.5376111225

21.7723635495

22.0419175444

21.3637720769

21.4363071268

23.4266957194

24.4332129469

23.5763075043

24.526119343

26.7103775344

27.9243178485

26.5724792994

27.5864808034

30.5959466398

31.4338209786

30.2955590111

31.2832111171

33.8175695684

34.5022830064

32.5514595073

32.7497187521

35.0137273702

34.211412979

32.6032779774

33.0511162595

36.1236257326

36.4189122862

34.991627827

35.2663728329

38.1001269981

37.8632899672

35.7750212103

36.4143300042

40.0327063916

39.4331702536

36.8226881595

37.5823842938

40.5706941057

39.9275660368

37.3001838135

38.3951744626

41.4255167827

40.9564862529

38.6931746431

39.3944233564

43.7056826098

42.4822868312

40.6616401887

41.2686163055

44.3108869134

43.1210817814

41.475724465

41.7112813516

45.8255288665

44.2971108359

42.2554692279

42.1748384928

45.5160945888

44.9686395827

42.9604993221

44.145375937

47.1252674138

46.565668216

44.4399828841

45.2041150331

48.6343246953

48.1890979043

46.4498923521

46.5459122778

49.6388265405

48.4664302554

47.0609946156

47.1898977778

49.8214280674

48.9696881447

46.0410475308

48.4056270444

52.8426362471

50.7242798671

48.9880250757

48.3587444716

51.9625487589

50.5239488359

49.4926396291

50.7544247634

53.8781539089

52.0821343734

50.227035289

50.6138187602

53.8249799661

52.8385716982

52.7444446183

53.4208766154

56.0486832442

53.9363851847

53.828829873

54.921459485

56.6331446255

55.110784087

54.3844963829

56.0740749479

58.7970022493

59.2285126741

59.56854238

58.9982796704

60.4650742659

58.6851219679

58.5695854212

60.2771586241

Milk price per hl

Quarter

Price per hl

Evolution of Milk Prices on a Quaterly Basis since 1971

22.9461688838

22.9393941363

25.616341484

22.3592843593

21.0610094135

22.9889630641

22.4953851065

22.4919078446

23.1963443263

26.0563284273

25.1759445684

24.6331693056

24.0781186279

23.723842872

25.1689165917

24.2158413516

23.9803497472

23.7540495479

23.1934066954

23.5611206699

24.9797932265

25.1103881625

25.3467962245

25.5876000772

25.7975371822

26.2178354422

24.2878563721

23.3592815677

23.6303714107

24.7308434783

25.2344970962

26.3154930178

26.5397255043

27.5522048196

27.7849761912

27.9230086546

28.1559030509

28.3077978711

27.0791912816

25.9734520942

26.3000339937

26.0345637188

28.6098926491

27.4933305895

30.6232605353

30.7153464553

31.3231860677

30.3948316084

30.6706057994

31.6322541006

31.3462832517

29.6551511533

29.4297277357

29.1707614347

29.5842544872

31.6985551589

33.4395569021

35.3409501873

34.8560841262

34.3865473305

34.9903644597

35.7638337741

34.1080993457

33.5147276952

33.2791356566

33.0300637733

34.1930957724

35.7766959582

36.2827932846

39.96783405

38.3833466027

37.9364498576

37.9050930153

38.5459270912

37.4991357939

36.4941674229

35.4186657416

35.025985753

35.2222462932

36.0018036156

38.2218663277

39.0873081204

39.8295238573

39.4011526586

37.4071299026

38.4000664177

37.3055353497

36.236104693

35.5409521905

35.2159102103

34.0348078274

37.7139747657

39.1137493144

39.8594976493

40.8940927428

40.9885077951

39.9757249532

40.1505305283

39.3993287157

38.6706858473

38.1913530526

37.6665857107

37.3568058693

39.8525779353

40.8212226891

41.8288921092

44.1821177208

41.9609851999

41.7117231184

42.3675186681

40.6996509208

39.8459285891

39.2870490798

38.2714548388

38.212806038

40.8304583997

42.0368282475

44.2502268291

46.2941695378

43.679648607

43.1594736815

43.8571087416

42.2170476415

40.9502697623

40.1553387251

39.404137647

40.0857330128

42.1270630905

42.5856572575

44.8001822057

45.9317688156

43.9351282624

43.5803664939

44.0923543054

42.9221686567

41.6001246203

40.7135336035

39.8009371304

41.2511081391

42.0981401579

43.8750533299

44.988678771

47.7255236354

44.5204701655

44.6469900662

44.9286374763

44.0784632966

42.7484658817

42.3406370061

41.4078615384

40.6983196464

44.0998307518

45.293709993

49.5093793657

47.4067291007

46.6081412505

46.177161513

46.735807376

45.7977255695

44.6225523735

43.4691242076

44.6787713544

42.9370045498

45.4513194554

46.3891753542

48.2772193813

48.8104108765

47.861829118

46.5824016853

47.2077449331

46.4780184169

45.4751515304

45.1650159397

44.3272610579

43.7412347079

45.4277267491

46.3700531501

51.135057198

49.5531809091

48.5492343995

48.023291915

48.336416255

47.3484669974

46.6410055064

45.7968726713

44.750626672

42.5274037204

46.8364831553

46.3712378815

49.5032316376

49.7295697047

48.7554323706

48.5005306981

49.4719037974

48.0547120994

47.2744447787

46.2477041009

45.84388847

44.7972029201

47.7490317209

47.3760842627

51.222572357

51.1012519034

50.1599189958

49.7954174939

50.7203430149

50.0640207081

48.7490705355

47.7120921368

46.9099925797

46.0599676267

48.8523341869

50.7539712188

52.4041886243

52.2872858145

51.1455294546

51.1583729665

51.8842843908

51.2197434273

50.1832610992

49.4891614136

48.9275539143

47.3596094751

49.94389857

51.5122683142

54.4075120579

52.6357734887

51.8966453891

51.4165163735

52.0963630044

51.7984756777

50.8082085472

50.0652521581

50.0175154639

45.2056523457

50.828688585

53.1322414941

53.1663488027

53.0427113079

51.853755038

52.4938205928

51.7881118448

51.1941709773

50.8670088721

48.7032546509

46.6575506981

43.8484521329

52.8021516506

54.2771852304

55.7352440037

54.7400046967

54.3549103342

52.8139379528

52.5769675178

53.0097969185

52.0319813352

50.7773203564

50.2876014904

46.7362561108

51.8309962417

51.9021980025

54.8278636893

53.7766666496

53.4082080105

52.1254105835

52.6532552696

52.7876680704

51.8248325149

50.8869104714

50.5256318567

49.2757167289

53.3407432695

55.2267537352

55.3013609746

56.058961868

55.2549508195

53.8721833184

53.7013137879

53.7316191229

51.9796024137

51.6504291382

50.7269388402

50.6236118763

52.2210091882

52.897415948

55.0731758906

55.2029295087

55.0093115723

52.8855165704

54.7423805659

54.6942771268

53.7245547876

53.0405673568

54.0799365704

52.4991397729

54.3765439075

56.1384185599

56.584626

57.3091537658

56.8345854887

53.0199201692

56.2235512547

55.3131072276

54.1712983157

53.9117636972

54.734379977

53.6431179952

55.8605586294

56.7471534881

57.3098992701

57.6548678391

56.2563923958

55.4611083988

56.3639527791

54.7250873571

52.888307417

54.7581264799

55.808057588

54.9254293139

56.2643554137

57.0833304433

58.1616635434

58.950610998

59.2572107017

56.5442415676

61.0673586006

60.210888078

60.4995736554

59.6804038036

58.5542674638

57.6896409346

58.9261815373

60.3874484216

60.6771739512

60.5129571277

60.226326452

58.363563574

59.5939707455

58.1591982803

58.2715881084

57.9766898092

59.4862448204

58.3190484736

61.2236920286

61.3524556127

Milk price per hl

Monyth/year

Price per hl

Evolution of milk price on a monthly basis since 1971

Balancing Supply with Demand Step 1: Estimating Demand Requirements

Balancing Supply with Demand Step 2: Setting Supply Target Requirements

Balancing Supply with Demand Step 3: Allocate MSQ - Historical Basis

Province

%

%

1982

2004

Newfoundland

0

0.14

PEI

1.9

1.74

Nouvelle-cosse

1,3

1,16

Nouveau-Brunswick

1,3

1,35

Qubec

48

45.48

Ontario

31,2

31,68

Manitoba

3,9

3,53

Saskatchewan

2,6

2,52

Alberta

6,7

6,55

C.-B.

3.1

5.86

Step 4- Allocation of Quota to Individual Producers

Daily quota system: no year end Daily quota established on a kg of butterfat per dayAdjusted regularly to reflect market demand fluctuation: upward or downwardTransferableProduction Quota

Balancing the Negotiating Power Marketing Agreements (MA)Terms negotiated between:Provincial boards and Processors Co-operative Private enterprisesA single sales agent (provincial board) negotiates: plant supply, milk quality, classes and prices, and payment terms

Balancing the Negotiating Power Domestic Price NegotiationsThe price of industrial milk sold in regular classes is set by the CDC following a consultation process and reflects a cost of production formula including return on investment and equityThe price of fluid milk is set by the provincesOne price adjustment per year (February)All processors pay the same price for a given class

Balancing the Negotiating Power Distribution of Producer Returns

Balancing the Negotiating Power Increased Market Concentration

Farm level 17,000 dairy farmsProcessing level3 largest dairy processors have 70% of sales of approximately $11 billionRetail level Largest retail chain has 35% of sales Top 10 have 90% of sales

Producer Returns (Deductions)Deductions per hL of monthly shipment:Transportation $2.32Administration $0.45Promotion $1.22Research and DHI: $0.12Total$4.11The operating costs of the system are therefore bourn by the producers.

Price of MilkMilk Prices Paid to Producers:

Ensuring Consumer BenefitsA Canadian Paradox: Canadas method of implementing supply management in the dairy industry results in benefits accruing to all stakeholders not just to producers

Ensuring Consumer Benefits Comparison of Canada-U.S. Retail Prices

Ensuring Consumer BenefitsNo Cost to Government

A System Under ThreatThree Pillars:

Import controls

Price setting

Production planning

A System Under Threat WTO Impending Threat Market ImportAccess Controls Domestic ProducerSupport PricingExport ProductionCompetition Discipline1-2-3-Each Pillar Can Be Affected:

Conclusion:Supply Management Benefits at StakeProducers ability to get revenues from the marketNo cost to governmentStable and reasonable prices for consumersStable and steady supply for processorsHigh quality products

Conclusion (continued):Supply Management Benefits at StakeMaintenance of family farms Benefits rural development and environmental sustainabilityProduction discipline which prevents surplus production that distort both international and domestic markets

Good morning. I am Bruce Saunders, First Vice-President of Dairy Farmers of Canada and I am accompanied by Yves Leduc, Director of International Trade for Dairy Farmers of Canada.

DFC is pleased to have once again the opportunity to share its experience under supply management. It is an efficient system that we dairy producers very proud of. In addition to my presentation, we have brought with us a copy of a study prepared by Daniel Mercier Gouin from Laval University demonstrating that supply management is a system that is still appropriate in 2005.

I hope, with this presentation, to provide you with a better understanding of how the system functions, the benefits of the system and how the Doha Round of negotiations could affect the future of our system.

The presentation will be broken into several parts: 1- Who we are?2- History of supply management in Canada3- Determining production quota4- Benefits of supply management5- Expectations from the Doha Round of negotiations6- Conclusion

Before getting into the fundamentals, I would like to provide you with a snapshot of why supply management is so important to Canada. A recent economic impact analysis study by Dr. Maurice Doyon from Laval University provides powerful economic arguments in support of the maintenance of supply management in Canada.

The contribution of the Canadian supply management industries is impressive as it adds a net $8.3 billion to the GDP, sustains more than $26 billion of economic activity, and over 142,000 jobs in Canada (approximately 13% of all the jobs in the food industry). Dairy is the third most important agricultural sector in Canada.

1 Dairy Economic Impact Study, Dr. Maurice Doyon, Laval University; based on 2002 dataCanadian dairy farmers have produced milk under a variety of market circumstances. Over the course of the 19th and early 20th centuries, we were major exporters of butter, skim milk powder and cheese. With minor exceptions, our producers were never as badly off financially as when they were heavily dependent on foreign markets. Even when producers, through co-ops, took greater control over the physical exporting of product, they were faced with formidable challenges in negotiating with foreign buyers who were interested in their own prosperity.

Canadian producers decided quite deliberately decided to focus their efforts to obtaining reasonable incomes on the domestic market. Attention to the domestic market brought a desire for equitable access and fair treatment of producers. Aside from prices, a major concern of farmers is an accurate measurement of the quantity and quality of the product sold honest weights and tests. Here again the pure market system had demonstrated a tendency toward buyer bias. Producers needed help in the form of regulation or third party independent testing. A regulated market was the solution.Over the past 30 years, supply management has proven an effective tool in the growth and development of our dairy industry.

The Canadian Dairy industry, which operates under a system of supply management, pursues 3 fundamental objectives. The first is to match production with the demand. This is done through consultations and negotiation with other stakeholders. Production controls administered through a quota system discourages production surplus. The second objective is to balance the negotiating power between stakeholders to obtain fair prices for the producer. Collective negotiation allows producers to reduce the distortion in market power caused by the concentration at the retailer and processor levels. The third objective is to ensure that, in return for paying a fair return to farmers for their labor, consumers consistently have access to adequate supplies of high quality food.

The effectiveness of the Canadian supply managed industries depends on three pillars: Import controls: import control measures allow domestic production to be planned to meet Canadian demand by limiting imports to the level of access agreed to at the World Trade Organisation. The level of access is equivalent to the size of tariff-rate quotas, and over-quota tariffs limit imports beyond this threshold. Producer pricing mechanisms (or collective marketing): this provides the farmers with the opportunity to obtain fair market returns. The right to collective action allows producers to counterbalance the much stronger market power of other agri-food chain players. Production planning: it allows supply and demand to be balanced, thereby promoting price and market stability.

These three pillars are equally necessary and equally important for the system to function. Also essential is a proper legislative framework that ensures all producers participate in the system. Without a proper legislative framework, the system could not function efficiently.

I will come back to these three pillars later in my presentation and show how the Doha Round of negotiations could affect them.

The need for intervention is fundamental to the structure of the industry because of the unequal the market power share. Without some form of collectivity, producers will always be in a weaker negotiating position. When, through market power, firms have control over prices, firms will calculate what they need and pass on what is left, if anything to their suppliers (in this case the suppliers are us producers). While some producers, some commodities, some countries are comfortable with the boom-bust cycle of the free market we dairy producers are not.

I firmly believe in a regulated dairy market.

The free market in dairy is problematic for several reasons. The main reason is the demand and supply dynamics of dairy products. Dairy product consumption, as in many agricultural products, does not respond strongly to change in price. In aggregate, dairy product demand is considered to change proportionately less in quantity than in price, when prices change. For example, a 10% decrease in price may at best move 4% more product. On the other side of the supply/demand equation, supply increase will dramatically affect prices. When you combine the low consumer response with the potential of greater supply the risk to producer income from excess production or additional supply availability becomes very clear. A 10% increase in supply would normally cause a 25% decrease in price. It is obvious that in international trade, where only a small proportion of dairy production is traded (5 to 7%), the potential for excess supply is a constant threat to prices. And this is the reality for most commodities around the world, and the example of coffee as been well documented.

Legislation exists in Canada that allows for producers, to act collectively and ensure supply match demand. By disciplining the level of production to match demand, supply management does not lead to over-production which would have to be exported on the highly distorted world market place. It also prevents surpluses from flooding the domestic market and driving prices to artificial lows and is therefore non-trade distorting. At the national level, the marketing boards cooperate under the National Milk Marketing Plan. This is a contractual agreement among provincial boards and provincial governments, and the Canadian Dairy Commission to establish quotas for industrial milk marketed on the domestic market, and to divide the required industrial milk production among the provincial boards. The Plan establishes the Canadian Milk Supply Management Committee through which the signatories implement the Plan. Canada is a country that is divided into provinces and producers of each province are represented at the national level through their provincial marketing board. Fluid milk remains under the authority of the provincial government although inter-provincial agreements allow for collective sharing of the market.

Discussions about supply and demand for industrial milk products occur at the Canadian Milk Supply Management Committee (CMSMC).

The key members of the CMSMC are the provincial marketing boards. (in green)At the same time, the provincial governments of the participating provinces are also represented on the Committee. (in pink)There are also important non-voting members, representing the producers, the processors and the consumers. (in orange)The Canadian Dairy Commission acts as the Chair. (circled in red)

The role of the CDC is mainly one of building consensus among the participants in the CMSMC. Although there are formal voting rules for the CMSMC, it is the normal practice to discuss policy issues among the voting and non-voting participants until a consensus is achieved.

The objective of matching supply with demand is to control market price and supply volatility, a problem common to easily perishable agricultural commodities. Before supply management was introduced, milk prices yo-yoed between low prices due to large surpluses of milk in the spring and summer months and high prices due to a low milk supply during the fall and winter months.

Under supply management, Canadian dairy producers enjoy the benefits of price stability. A comparison with the United States is useful to demonstrate this benefit, as can be seen on this chart.

Explanation of the graph: evolution of producer prices and retail prices in the US over the period 1990-2004Blue line: US Highest of Class III (cheese) and Class IV (butter and powder) - IndexRed line: Canada- Industrial Milk Target Price Index (DPI)Source: Class III and IV Price: USDACDC

As can be seen on this chart, the Canadian milk production is planned throughout the year and processors get a stable supply of milk month after month. By managing the production throughout the year, we have been able to overcome the cyclical production cycle observed in most dairy producing countries (New Zealand for example). This is an important aspect of our system and one that benefits the processors who can efficiently use the processing facilities.

The first step is to estimate the demand for the coming year.

Working together, the representatives from each province determine the level of milk supplies needed for domestic use in Canada for the current dairy year.

The key factors considered by the CMSMC are:

anticipated consumption, which depends mainly on demographics and economic conditions; evaluation of stocks of dairy products - stocks at the beginning an d at the end of the dairy year; expected imports - these are predictable, given that Canada has WTO commitments to tariff quotas on cheese, butter, and a number of other dairy products; traditional exports - these are mainly exports under Canada-specific tariff quotas and expected transactions by the CDC in markets controlled by state importers and; possible changes in market conditions such as economic instability or changes in production conditions, that may affect demand for Canadian dairy products.Once domestic requirements are determined, then the CMSMC develops supply targets to meet the demand. The supply target for industrial milk is called the national Market Sharing Quota (MSQ). MSQ is meant to meet the expected demand. After the supply target for industrial milk has been determined at the national level, step 2 is to allocate shares of MSQ to each province.

Shares of MSQ are allocated essentially on a historical basis, or more specifically, those that were in effect as of August 1, 1982, the beginning of the National Milk Marketing Plan.

Historical shares are adjusted on an annual basis to account for transfers of quota between provinces within pooling arrangements.

What is important to retain from this table is that our system is not static and has evolved continuously over the past 35 years.Once a province establishes its quota for the dairy year, it then allocates it to individual producers.

For example, Dairy Farmers of Ontario (DFO) is responsible for administering quota to Ontario producers. DFO makes a single allocation to each producer which represents that producers share of the fluid milk sales, plus his share of the domestic market for industrial milk.Individual producer shares of provincial quota are determined by the permanent quota rights held by that producer. However, quota is also transferable among licensed producers.The daily quota system operates as a continuous quota system with no year-end. It is unique in the sense that each unit of quota is based on fulfilling the demand for industrial milk (federal jurisdiction) and fluid milk (provincial jurisdiction). The quota is established in kilograms of butterfat per day to the nearest 100th of a kilogram.It is adjusted on a regular basis to reflect market demand fluctuation: upward or downward. And it is transferable between farmers through a quota exchange.

Legislation was passed in Canada that allows for producers to act collectively when negotiating with processors and retailers. This is done through the provincial marketing boards at the CCSM. Provincial marketing boards are given, by their members, the right to negotiate marketing agreements with the representatives of 1) cooperative processors, and 2) private processors. The terms negotiated apply to all processors. The management of milk for plants as well as the re-distribution of the funds is the provincial boards responsibilities.

The Agreements establish: prices guaranteed supply categories supply rules milk classes quality rules plant billing and producer payment terms

The price of industrial milk sold in regular classes is set by the CDC following a consultation process and reflects a cost of production formula including return on investment and equityThe price of fluid milk is set by the provincesOne price adjustment per year (February)All processors pay the same price for a given class

All milk is sold collectively by producers to processors and is billed on the basis of its use in the various product classes. Processors pay for each kilogram of components (fat, protein, lactosis and other non-fat solids).

An average price for each component sold within quota is calculated from the result of these sales. This is called the pool price or pooling. All producers therefore obtain the same average price regardless of the plant that received their milk and its end use. Only over-quota milk is not pooled.

Total returns from in-quota milk sales are pooled among all producers. Payment is based on the components in milk (fat, protein, lactose and o.s.). Provincial boards calculate the pay of their producers.

As stated previously, the second objective of our supply management system is to balance the negotiating power between stakeholders to obtain fair prices for the producer. Collective negotiation allows producers to reduce the distortion in market power caused by the concentration at the retailer and processor levels.

Increased market concentration places the individual producer at risk for exploitation. For example:

At the farm level:In 2003, total net farm cash receipts from 17,000 dairy farms generated approximately $4.5 billion. At the processing level:During the same period, dairy products shipped from approximately 444 dairy processing plants (278 federally inspected) were valued at more approximately $11 billion. The 3 largest dairy processors currently have more than 70% of sales of dairy products. (Saputo, Parmalat and Agropur). Retail A limited number of grocery chains now control the retail industry. The Top 10 retailers have 90% of total retail sales. Loblaws has 35% (more than $20 B) of total retail sales. There is significant concentration at the processing and retail levels of the marketing chain. Since the processing and retailing side of the market is controlled by a small number of companies, they have significant bargaining power compared to the individual farmer. In the absence of a regulatory framework that supports producers ability to act together and counteract imbalances in market power, the ability to obtain their fair share of the consumer dollar could be lost, requiring the balance to be made up for in support payments from taxpayers dollars. Retail level Largest retail chain has 35% of sales Top 10 have 90% of sales

This is not a solely Canadian phenomenon. Producer organizations such as The International Federation of Agricultural Producers (IFAP) are also concerned by this phenomena and brought this question to the forefront last June, at the time of 36Th World Farmers Congress.

Deductions to producer payments are applied per hectolitre of monthly shipments. Deductions include: transportation @ $2.32 administration @ $0.45 promotion @ $1.22Research @ $0.06 and Dairy Heard Improvement @ $0.06 for a total of over $4.11 (These are the figures for the province of Ontario, These deductions may vary from one province to another)

Total deductions for the month are then subtracted from the total milk value resulting in the producers net payment.

This is an important aspect of the Canadian system. It shows that all the costs necessary to operate the system are in fact bourn by the producers.

Canadian dairy producers generally receive a wide range of prices for their milk. Sales are classified by how the milk will be used. The highest prices paid are for milk produced for the domestic fluid market, and the lowest prices are generally paid for milk or milk components used in such industrial milk products as butter and skim milk powder.

As of February 1st, 2005, the target price for industrial milk will be established at $68.42/hl (for milk containing 3.6% butterfat).

Note: prices in the table reflect 1-5d blend price (not including the subsidy).

Source:Canadian Dairy CommissionIn the Canadian experience of increased market concentration, supply management has given dairy producers effective mechanisms to counteract the stronger market power in other sectors of the food marketing chain. As the Canadian experience shows, when primary producers have collective power in the marketplace, it allows for a balance between stakeholders to be achieved, ensuring that market power is not exercised at the producers expense.

It is important to stress however that the benefits accrue to all stakeholders, not just producers

With supply management: Producers obtain a decent income;Canadian consumers get a great deal for high quality dairy products; and,Processors earn profits (Saputo has posted over the years better results from its Canadian operation; Parmalat has decided to keep its most profitable operation based in Canada following the Parmalat scandal).

This graph reconfirms that supply management benefits co