After sitting through a day-long hearing at the appeals tribunal today, I am more convinced than ever that supply management is a cumbersome, inflexible system that frustrates innovation and market development in the dairy industry.
At issue was a decision by the Ontario Ministry of Agriculture, Food and Rural Affairs to grant a permit to Azad Damani, owner of Esskay Dairy Ltd., to renovate an old milk-processing plant at Millbank so he can produce a highly-successful yogourt drink being made in Europe.
His proposal is modest - only about 400,000 litres a year, which is 0.06 per cent of the industrial milk supply in Ontario - and he said it will generate about 15 to 20 jobs, will satisfy the desire for local products and the demand for liquid yogourt called Lasi.
The Ontario Dairy Council, which represents most of the processors in the province, including multi-national giants such as Parmalat and Saputo, said this is not fair because it will reduce the volume of milk available to existing processors.
And Tom Kane, president of the Ontario Dairy Council, emphasized that Ontario's dairy farmers, because they operate within a national supply-management system, cannot increase milk production to supply this new business.
There were dozens of details to the appeal tribunal hearing, including references to special programs for companies that want to try producing new products, but the bottom line is that the Ontario Dairy Council opposes this plant proposal.
Incidentally, this yogourt drink will be made from a blend of milk from cows, goats and sheep. There is no supply management for goat milk or sheep milk. In fact, there are no controls whatsoever on sheep milk, not even quality and food safety regulations.
Supply management as it's being run in this nation is a recipe for disaster. I'm glad I haven't got a cent invested in the business.
