Milk Producer - March 2010 - (Page 44)

MARKETS Butter stock levels considered he Canadian Milk Supply Management Committee (CMSMC) is addressing mounting butter stock levels by not allowing any increase to market sharing quota (MSQ), according to a report issued after its January meeting. At the meeting, the CMSMC had considered a recommendation from its Secretariat, a technical advisory committee, to reduce MSQ by 1.2 per cent from February to July to reduce surplus butter stocks. This would have translated into a 0.66 per cent reduc- T tion to provincial quotas in the P5. However, the provinces were unable to reach consensus on that recommendation. CMSMC decisions require consensus among all 10 provinces. Instead, the committee agreed to freeze MSQ at the December 2009 level equivalent to 50.01 million hectolitres for a period of six months beginning February 2010. From February to July, MSQ would only change if the Canadian requirements calculation translates into a decrease. Provincial quotas would be adjusted if there is a decrease in Canadian requirements or a change in fluid milk demand. Further, it was proposed starting Aug. 1, the Canadian Dairy Commission (CDC) be mandated to adjust MSQ as required for growth allowance and butter stock management. This would let the CDC over-issue MSQ by up to one per cent when butter stocks are low and a growth allowance is required to support market growth, and under-issue MSQ by 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 78 76 74 72 70 68 P5 $71.83 WMP $74.24 2.4 SNF-BF Ratio 2.35 2.3 2.25 2.2 2.15 2.2658 Blend price in $/hL Jan 2009 Feb 2009 Mar 2009 April 2009 May 2009 June 2009 July 2009 Aug 2009 Sept 2009 Oct 2009 Nov 2009 Dec 2009 P5 blend price WMP blend price Ontario’s SNF-BF ratio 44 | March 2010 | MilkPRODUCER Feb 2009 Mar 2009 Apr 2009 May 2009 June 2009 July 2009 Aug 2009 Sep 2009 Oct 2009 Nov 2009 Dec 2009 Jan 2010 Target SNF-BF ratio

Table of Contents for the Digital Edition of Milk Producer - March 2010

Milk Producer - March 2010
Contents
Editor's Notes
DFO Chair's Message
Provincial Perspectives
Dairy Update
DFC Policy
Farm Finance
DFC Promotion
Heating With Cow Power
Processor Spotlight
Issues Update
Research
Applied Science
Ruminations
Markets
New 'N' Noted
Back Forty

Milk Producer - March 2010