Despite mounting evidence that it's quota transfer policy is failing, the directors of the Dairy Farmers of Ontario marketing board continue to hold a $25,000 cap on quota prices and to ban whole-farm mergers.
British Columbia has, on the other hand, dropped its ban on whole-farm mergers - sort of. Beginning Nov. 1, farms can be bought and half of the quota can be merged; the other half has to be auctioned through the quota exchange. It's now kind of like a choke hold instead of a strangle hold.
Under the Ontario policy, hardly any quota is being offered for sale on the monthly exchange the board runs, not even enough to satisfy demand for quota under its new-entrants program.
While the price cap and whole-farm merger policy remains in place, the most innovative and efficient farmers are stymied from investing to increase their market share while many who are simply riding the waves awaiting retirement continue to be rewarded with a steady stream of profits.
This is precisely the wrong approach to keeping the industry competitive, market-oriented and sustainable.
