New Initiative Helps Dairy Industry Feed Itself

A new three-year, $12-million land development initiative will assist the dairy industry to become self-sufficient in the local production of forage, ultimately lowering the cost of importing forage and improving dairy producers� bottom lines.

�On-farm forage production will enable farmers to make their operations more competitive and the production of industrial milk profitable,� said the Honourable Kathy Dunderdale, Minister of Natural Resources and Minister Responsible for the Forestry and Agrifoods Agency. �The dairy industry currently imports approximately 22,000 metric tonnes of forage at a cost of more than $4.4 million each year. We want to be able to produce more of that forage within the province, lowering the transportation and fuel costs for farmers.�

The Provincial Government is investing $6 million over the next three years under the Agriculture and Agrifoods Development Fund to assist dairy farmers to develop larger acreages of land for increased forage production. This funding will be matched by individual dairy farmers for a total expenditure of $12 million on land developments projects. The initiative will ensure long-term job security for existing farm employees and will create approximately 360 seasonal jobs as the land is developed. The announcement was made this morning during the annual general meeting of the Dairy Farmers of Newfoundland and Labrador.

Crop input and equipment suppliers will also see an increase in employment and sales during the land development process and into the future as a result of increased forage production and harvesting activities. Forage comprises approximately 40 per cent of a dairy cow�s daily feed.

�This is a strategic investment in a key area that will see the dairy industry advance and ensure its long-term sustainability,� said Minister Dunderdale. �The agriculture and agrifoods industry is a significant contributor to the province�s economy and it provides meaningful employment in many rural communities. This initiative provides dairy farmers with the necessary support to maintain the growth and momentum of this industry.�

The Dairy Farmers of Newfoundland and Labrador applied for funding to create and administer the land development initiative on behalf of its 37 registered dairy producers. The organization is the regulatory body for the production and marketing of milk in the province.

�Additional land development is critical in overcoming the challenge of inadequate forage production and the development of a more competitive sector,� said Robert Walsh, chairman of the Dairy Farmers of Newfoundland and Labrador. �With government�s support, we will be able to reduce overall feed costs for the industry and ensure improved profitability for producers.�

The initiative will secure the continued production and supply of industrial milk to existing secondary processing facilities and provide potential for expansion and new processing opportunities. Increased utilization of industrial milk will enable the province to fulfill production requirements related to its share of the national industrial milk quota.

In 2001, Newfoundland and Labrador�s dairy farmers joined the National Milk Marketing Plan and were allocated a quota target of 31 million litres of industrial milk production annually by 2016. If the province is successful in achieving its allotted industrial milk quota within the National Milk Marketing Plan, the province�s dairy industry would double in size from 2001 to 2016.

The Agriculture and Agrifoods Development Fund was established in 2006 to encourage the development, diversification and expansion of large-scale agricultural projects in the province�s primary and secondary processing sectors. It is under this program that funding was provided for a premium ice cream line at Brookfield Dairy, a specialty cheese operation at Central Dairies and an egg-grading facility on Roaches Line.

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2009 11 19                          10:00 a.m.