Supply management and the dairy industry
Information on Supply Management and the Dairy Industry
Supply management in the dairy industry
In a supply management system, demand is forecast by means of calculations, and production signals are sent out to producers based on the demand forecasts that are obtained this way.
The Canadian Milk Supply Management Committee
The Canadian Dairy Commission chairs and supports the Canadian Milk Supply Management Committee (CMSMC) and its secretariat. The Committee serves as the key national body for policy development and discussions respecting the dairy production and processing sectors.
The Committee meets four times yearly to examine the main production, economic and marketing factors affecting the dairy industry, including:
National milk production target for Canada
The Total Quota is the national milk production target for Canada. On behalf of the industry, the Canadian Dairy Commission calculates the Total Quota on a monthly basis, according to a method set by the Canadian Milk Supply Management Committee. This target is expressed in kilograms of butterfat, and is monitored on an ongoing basis and adjusted as needed to reflect variations in supply and demand. The national quota is allocated among regional pools.
Dairy Industry
The Canadian Dairy Commission supports the industry by developing national and regional policies on dairy production, by detecting fluctuations in demand for dairy products and in milk production, and by coordinating the pooling of milk revenues and market sharing systems. The Canadian dairy industry is governed by a supply management system.
Roles and responsibilities
Responsibilities of the federal departments and agencies
The Canadian dairy industry comprises several federal stakeholders, including:
Le système de gestion de l’offre du secteur laitier
La gestion de l’offre dans le secteur laitier
Dans le domaine des produits laitiers, l'équilibre entre l'offre et la demande suppose un équilibre entre la production de toutes les fermes laitières et la consommation intérieure de produits laitiers. Le contrôle de la production nationale à la ferme se fait grâce aux quotas. La gestion des approvisionnements tient également compte de certaines importations au Canada et d'une partie de la production qui est expédiée sur les marchés d'exportation.
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Milk pooling agreements
For dairy producers, milk pooling agreements are a way of managing the financial risks associated with the trends in domestic markets. The Canadian Dairy Commission administers these agreements on behalf of the dairy sector. The pooling of revenues from milk sales enables producers to receive an average price per hectolitre or per kilogram of components, based on total sales.