MARKETS Incentive days pondered M ilk production has continued to lag across most of Canada since the start of the new dairy year last August. Dairy Farmers of Ontario (DFO) was considering action at the end of February to encourage more milk production to ensure all markets are filled. Providing incentive days beginning in March and continuing until the fall incentive period next August was an option the DFO board was to consider at its meeting the end of February, after The Milk Producer went to press. Milk supply trends early February showed Ontario would fill just over 98 per cent of its quota during the current dairy year, ending July 31, according to Phil Cairns, DFO’s senior policy adviser. Poor feed quality from the 2008 crop is considered the main culprit. Ontario’s provincial utilization for the first six months of the dairy year was projected at just over 96 per cent, Cairns says. This figure accounts for the substantial increase in demand as a result of growth in P5 Domestic Dairy Product Innovation Program volumes. They were up 36 per cent over the first four months of the dairy year. Innovation volumes for the P5 provinces now equate to 0.7 per cent of total quota. Quebec and Maritimes production down, too Milk production in Quebec and the Maritimes has also been down this year, he notes. Since Ontario and Quebec make up 94 per cent of P5 production, the P5 supply situation is now looking tight in 2009. Supply projections for Quebec came out to a provincial utilization of 94.8 per cent for the first six months of the dairy year, and 97.5 per cent for the 12 months ending July 31. Estimates for Prince Edward Island P5 and Western Milk Pool blend prices* The graph below shows the 12-month blend price for the P5 provinces and the Western Milk Pool (WMP). *There is a two month lag reporting these figures. Solids non-fat to butterfat (SNF-BF) ratio This graph shows Ontario’s SNF-BF ratio for the last 12 months in relation to Ontario’s target SNF-BF ratio of 2.2840. 2.45 74 72 70 68 66 64 P5 $70.81 WMP $72.03 2.4 SNF-BF Ratio 2.35 2.3 2.25 2.2 2.15 2.2496 Blend price in $/hL Jan 2008 Feb 2008 Mar 2008 Apr 2008 May 2008 June 2008 July 2008 Aug 2008 Sept 2008 Oct 2008 Nov 2008 Dec 2008 P5 blend price WMP blend price Ontario’s SNF-BF ratio 48 | March 2009 | MilkPRODUCER Feb 2008 Mar 2008 Apr 2008 May 2008 June 2008 July 2008 Aug 2008 Sept 2008 Oct 2008 Nov 2008 Dec 2008 Jan 2009 Target SNF-BF ratio
Table of Contents for the Digital Edition of Milk Producer - March 2009