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Re: Australian milk prices for bruce centash and who ever else


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Posted by Bruce from Can. on March 17, 2019 at 03:43:12 from (74.12.73.21):

In Reply to: Australian milk prices for bruce centash and who ever else posted by down under farmer on March 16, 2019 at 21:53:21:

Every farm is different and every farmer has a different story. I have never been to the other side of the globe, but I get some information from time to time. First thing that I have always understood was in Australia saving water and irrigation of crops is a common practice. Here in Canada, were I live, in South Central Ontario, draining excess water off the field is often needed to grow crops. We have one short growing season, and a very long harsh winter, so most dairy cows are fed stored feed 365 days of the year, and mostly kept in confinement freestall barns during lactation. Very little grazing is practice any more. And we have no such thing as seasonal dairying, farms in Canada must produce a constant supply of milk to the market all the year round. Canada has a small population,roughly 35 million people, spread thinly over one of the largest countries in land mass in the world. And it also has areas with very dry climate, very harsh climate and a very excellent climate for dairy production. Sustainable dairy farming needs are well met in Southern Ontario, which isn’t much different than any of the USA border states, prefect for growing forage crops for dairy cows.
As soon as I read the sign , stating how generous the store was , providing a extra ten cents to help farmers struggling with low prices and drought conditions, I New that it was only a self serving public relations stunt by the retailer, and that they had been turning the screws tighter and tighter on the Australian dairyman ever since deregulation came into effect. There is in my opinion no time soon that Australia will run out of milk, but I will concede that milk may be imported from New Zealand. Or forage crops would have to be grown on irrigated land, which currently grow higher value crops,if the drought continues, and I don’t see that happening, too much $$.
And speaking of dollars, as a Canadian Dairy farmer, I have really no problem with the price which I received for my milk. We have a Jersey herd, with average Butter fat test of 5.5% and last month I was paid .96 cents per litre for our milk. My price is paid out based on components with in the milk, and it is sold into the same market as all other conventional milk produced in Ontario. The price paid out is a blended price , of all the milk sold in Ontario during any give month. So it is not just fluid milk/or town milk, but also reflects the milk that is used in making lower cost industrial products like cheese and Yogurt. I have friends that insist that their Holstein cows are better and more profitable, but wine and cry about only getting..70-.75 cents per litre for the milk which comes off their farm. While I can get .20 cents per litre more. Farmers need to produce the products that the market wants, and the product the processors want is Butter Fat. Farmers tend to be hard headed, and just carry on doing the same thing, and expect to get better returns, but not willing to add any additional value to the milk. There is only one number that matters in dairy, and that number is the difference between the cost of producing milk, and the price you are paid. I can produce milk on my farm with a variable cost of .55 cents per litre. And as I have said, last month I was paid .96 cents. So my profit per litre was.41 cents. If my cost per litre was .55 cents while my pay out was .75 cents, simply said I would show a . 20 cent profit. Supply Management doesn’t guarantee a profit, only a market. If your cost of production is too high, your profit margins will be small. So before anyone wants to jump on me about being born with a silver spoon in my mouth. I started from scratch with not much more than desire to be a dairy farmer. I bought all of the production quota that our farm holds, as well as purchased the 276 acres of very good quality land that we are so fortunate to farm. While I still carry a small debt, much of the debt I carry was created to bring my oldest son into the farm, and will be written away within the next 6 years.
Unlike phillip, I feel that we receive a good price for our milk, and I am satisfied with the returns we get. Only downside I see is the constant demands from other countries around the world that cannot manage to control the gross over supply of milk production that has ruined their farm economy, wanting to dump the surplus produce that they, often times indirectly subsidize their farmers to produce, into our domestic market. And throw us into the abyss , drowning in a sea of unwanted milk. Bruce


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