The Rural Voice, 1992-11, Page 27too concerned
about a minority of
farmers. Large
processors who
already have skim -
off butterfat from
their processing of
milk, may not
worry so much
about cream prod-
ucers. With the
concentration of
ownership and
production in the
processing ind-
ustry, most of the
small creameries
that wanted the
cream have dis-
appeared, bought
for the value of their quota by large
conglomerates.
In a presentation to the Rural
Agriculture Caucus of the Ontario
New Democratic Party in June four
cream producers from the Middlesex -
Elgin Cream Committee said the
change to multiple component
pricing for milk, turned their cream
from a product in its own right, to a
product based on its butterfat. "It
appears that the cream producers'
market is being swallowed up by
changes in the whole milk industry.
Presently the Ontario Milk Producers
Marketing Board (OMMB) is having
problems with their own `fluid skim -
off'. If cream producers lose their
market as a result of butterfat and
solids non-fat, the OMMB would not
have to reduce their own Market
Share Quota to fix their marketing
problems around this over -production
of butterfat and solids non-fat.
OMMB would simply fill the void
created by the cream producers'
inability to ship all their cream." The
cream producers claimed the Farm
Products Marketing Commission and
the Canadian Dairy Commission
have put pressure on their industry
and made it difficult for them to be
competitive.
In 1988, in an effort to head off
the problem, a conversion program
was set up to allow cream producers
to convert their cream quota to milk
quota. Few cream producers have
taken advantage of the opportunity,
however. Many can't. The majority
of Ontario's remaining cream
producers are Amish and Mennonite
The Haelzles milk 40 Ayrshire and Holstein cows and feed the skim milk to veal
calves. The also have a cow -calf operation and cash crop on 475 acres.
farmers. Their religion prohibits them
from having electricity, and the
tougher standards of marketing whole
milk mean they must have an
electrically -powered milk cooler.
Other farmers, who have used cream
production as a less-expensive way of
getting into farming, can't afford the
changes conversion to milk
production would mean.
Robert and Judy Haelzle's farm
isn't the kind of farm one might
expect visiting a cream producer. The
couple's house is a neat, modern,
ranch -style house and the barn is
large and modern looking, just like
any other dairy operation. In fact
until 1986, the Haelzles were milk
producers. Robert says he felt big
corporations were undermining the
supply management system and the
"Producing cream
is a way of helping
pay the bilis. I
wouldn't say there's
a fortune in it."
system was not going to last. He
decided to sell out. After his dispersal
sale, however, he had 18 dairy heifers
that didn't go through the sale. He
planned to sell them as bred heifers
but the bottom fell out of the bred
heifer market. Since cream quota was
relatively inexpensive, he decided to
produce cream, feeding the milk to
calves in a vealing operation.
Today the Haelzles
milk a 40 -cow herd
of Ayrshires and
Holsteins with a
pipeline milking
system, producing
during the summer
peak season 28 cans
of cream a week.
They feed 40 calves
at a time, marketing
them through the
veal sale at the
Brussels Livestock
Market. They also
run a cow -calf
operation with Here-
ford-Charolais
crossbreeds and cash
crop on their 475
acre farm east of Teeswater.
Producing cream is "a way of
helping to pay the bills. I wouldn't
say there's a fortune in it by any
means," Robert says. "In order to be
viable you've got to find something
to feed the milk to."
Cream producers almost
invariably are mixed farmers. The
value of the skim milk in feeding to
calves or pigs as a protein supplement
is one of the advantages cream
producers have in farming. Bascd on
soybean prices and protcin levels,
milk has been calculated to be worth
$3 per hectolitre when fed to pigs. In
addition, skim has a high lycine
content and high palatability and the
advantage of being right on the farm,
instead of having to be trucked in.
Cream producers also have lower
costs of running their operations.
They don't need a milk house or bulk
cooler, and separators and a cream
cooler are much cheaper to buy than
milk equipment. There also aren't the
tough seasonality standards under
which milk producers must balance
their shipments throughout the year.
The lower cost of crcam quota
means that it takes nine months of
gross receipts to pay for quota
compared to 3.5 to four years for
industrial milk quota. So far quota
cuts have also been made without
touching actual cream quotas because
the cream board has absorbed them,
using unused quota.
Still, Robert Haelzle says there has
been talk of a quota cut of up to 30
per cent. If it happens, he says, "I'd
say that the end (of the industry). I
NOVEMBER 1992 23