It is always good to prepare for the future. The past year has given many people an unusual amount of time to observe. With the phrase “COVID-19” securely planted in our everyday vocabulary for the foreseeable future, limited contact with others has allowed for more time to examine how things have been done and how they can be improved.
After sufficient observation time, it often feels natural to wonder what is ahead. Offering insight into the current and projected state of Canada’s dairy industry, four panelists at Grey Bruce Farmer’s Week did just that. Representing different sectors of the dairy industry, the panelists gave their expectations of where Canada’s dairy industry is headed during the “Future of the Dairy Industry in Canada” panel presentation held virtually on Jan. 7.
Here are some of their thoughts and projections from the panel discussion.
Trade agreements
“We must rely on partnerships, collaboration and a common vision from all the stakeholders to support future growth and ensure a healthy industry,” said Mark Hamel, the second vice chair on the board of the Dairy Farmers of Ontario.
Michael Barrett, president of Gay Lea Foods Cooperative, also expressed there is a need for “one dairy voice” within Canada’s dairy sector. Barrett said a common vision and integrated supply chain will go a long way to help Canada’s dairy industry in the trade market. “This perspective about the continuing challenges of trade and access to markets and compensation is not a long-term solution to the changes that are taking place; it needs a commonality of being able to work together to be able to understand that we have a common agenda and a common future as well,” Barrett said.
Bruce Muirhead, associate vice president and professor at the University of Waterloo, noted a big challenge facing Canadian dairy is changing trade deals, namely American adherence to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Muirhead has projected the new Biden administration will take efforts to rejoin the agreement. “There is some thought that they will demand access, the same percentage of access, to the Canadian dairy market as is given to all other signatories to that agreement, so that will have an immediate impact on us,” Muirhead said.
Consumer demands for sustainability
“Because there is a blurring of lines now on who does what, consumers are not necessarily concerned about what a processor does and what a producer does; they’re looking for a quality product that has environmental sustainability and traceability. It’s less about what people do and more about what the outcome is,” Barrett said.
To address this, Vern Osborne, professor at the University of Guelph, said, “[Dairy farmers] have a huge potential to really market [their] product based on the fact [they] actually are guardians of the environment.” Osborne said dairy farmers should feel encouraged to become “carbon farmers” and explore technologies that can increase carbon sequestration on their farms.
Although consumer demands are evolving, there is still widespread support from consumers for Canada’s dairy industry. Muirhead cited a survey which found 66% of Canadians said if domestic dairy products were more expensive than imports, they would still purchase them. Muirhead expressed optimism towards Canadian consumer support for domestic dairy. He said, “Supply management serves Canadian purposes. … This is the quintessential Canadian food sovereignty system (it seems to me), that’s made in Canada, serves Canadians extremely well – both consumers and producers – and is a really great benefit to society as a whole.”
Innovation and competition
The need for modernization and innovation was discussed by the panelists. Barrett mentioned the dairy industry needs to move to promote investment and modernization within every sector of the industry. He said a broad approach to innovation will help meet consumer demands to a greater extent. “It’s not just about innovation in packaging; it’s about innovation in delivery models, innovation about what’s done at the farm and innovation about what’s done at our processing plants,” Barrett said.
“Product development and innovation is critical,” said Hamel, echoing some of Barrett’s views on a need for increased innovation in the industry. Hamel noted producers should focus on innovations that drive efficiency in order to increase profits. “I don’t really see an escalating milk price as [something] sustainable or [something that] can be maintained. I think we will be receiving our profits or returns from other areas; you know, driven more from efficiencies in production, transportation, processing marketing and an increased market growth,” Hamel said.
Increased competition will become an even bigger challenge to the Canadian dairy industry, Hamel added. “I believe competition will continue and increase, not only for our products but from other countries. We will continually need to differentiate our Canadian products in quality, and also in the production methods, ensuring they support a sustainable environment,” he said.
Osborne also noted competition will likely increase, but from a different source. “Competition is going to come from synthetic agriculture. So basically, artificially produced milk and milk products. It’s coming fast and furious,” Osborne said.
All the panelists agreed there are many challenges on the horizon for the Canadian dairy industry; however, they all expressed cautious optimism towards the longevity and stability of the industry.
“The stars are more or less aligned in favour of Canadian dairy,” Muirhead concluded.
