The Provincial Government is accepting proposals for a study to determine the feasibility of private industry establishing primary and secondary production of milk in Central Labrador with a view of supplying milk to Labrador and Nunavut.

"The study is part of our strategic approach to determining the economic feasibility of establishing primary and secondary production of supply managed commodities, such as dairy, in Labrador," said the Honourable Kathy Dunderdale, Minister of Natural Resources. "We are constantly exploring the potential for growth and the opportunities that exist in agriculture in communities across our province and this study will help us focus our efforts in Labrador."

The department has issued a call for proposals seeking a consultant to undertake the detailed study of milk production, processing and marketing and to provide a report to government. The deadline for proposals is March 23 and the study is expected to be completed by the fall.

"I believe Labrador certainly has the potential for a project such as this," said the Honourable John Hickey, Minister responsible for Labrador Affairs. "Studying the feasibility of Central Labrador supplying fresh milk to our communities is yet another great example of this government's commitment to diversifying the agricultural industry in Labrador."

The department developed the Terms of Reference for this study in consultation with the Lake Melville Agricultural Association and the Dairy Farmers of Newfoundland and Labrador.

The Northern Agrifoods Development Strategy identified the need to determine the economic feasibility of primary and secondary production of supply managed commodities such as dairy. Supply management matches production on the farm to consumer demand, bringing stability to the egg, chicken and dairy industries for processors and consumers in relation to supply, quality and price.

The consultant chosen to undertake the study will be required to review a variety of issues, including commodity regulations, cost of production, market research and processing and distribution. The study is being funded by the provincial and federal governments under the Canada-Newfoundland and Labrador Agricultural Policy Framework (APF). To date, $1.5 million has been approved under APF for projects in Labrador.

The Terms of Reference for the study are available at //www.nr.gov.nl.ca/agric/ or by calling 709-637-2572.

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Media contact:
Tracy Barron
Director of Communications
Department of Natural Resources
709-729-5282, 690-8241
tracybarron@gov.nl.ca

2007 03 15                                                  4:05 p.m.