Dairy farmers are getting cut back on new quota, and more could be to come.
Effective May 1, Ontario dairy farmers lost 1.5 per cent of their quota, and fall incentives for 2018 got cut back to two days each in September, October, and November.
High volumes of milk are being skimmed and production is above projected market growth, according to the Dairy Farmers of Ontario (DFO).
This follows the March announcement that the DFO wouldn’t be giving out any more quota this year, with milk production already too high from the creation of Class 7 milk. The milk class was created to let domestic producers compete with American production of a twice-refined milk product that dodged tariffs at the border and could be used for cheese, giving American producers a competitive advantage.
Not all producers were happy with Class 7 milk, given its much lower price tag, something the DFO sought to compensate for with quota increases.
The DFO also warned that further reductions may be required.
