Tensions grow over spilled milk as N.L. farmers call on retailers to lift restrictions
Newfoundland and Labrador dairy farmers were forced to spill tens of thousands of litres of fresh milk this week after the Nova Scotia market weakened, local retailers slashed orders, and consumer demand softened.
But a leader in the province's dairy industry believes some stability is on the horizon.
It's a consequence of the unprecedented situation created by the COVID-19 virus, with the demand for dairy products slumping across the country.
But in this province, the tension has been elevated by a heated round of bickering between dairy farmers, the minister who represents their industry, and the national body that represents retailers.
Meanwhile, the association that represents two dozen dairy farmers in the province confirmed Thursday that 170,000 litres of milk, at a farm gate price of $1 per litre, was dumped this week.
That less than one per cent of annual production, but is a circumstance that rarely occurs in the industry.
"It's unprecedented what's going on," said Goulds farmer Crosbie Williams, who is vice-chairman of the Dairy Farmers of Newfoundland and Labrador, which controls the production and marketing of milk in the province.
A rush to stock up
The problem began a few weeks ago when public health officials began implementing increasingly stricter travel and physical distancing restrictions in order to help curb the spread of the coronavirus. Citizens are also being advised to limit their trips to the grocery store to once-a-week.
This prompted many people to begin buying food and other necessities in large quantities. The milk supply in stores was quickly gobbled up, and so were other products such as chicken and eggs.
This prompted some retailers, including Walmart, Dominion and Sobeys, to slap purchase limits on items like milk.
And with so much milk — with a 21-day best-before date — already stuffed into refrigerators throughout the province, sales plummeted last week.
As a result, Williams said, orders from retailers fell by 30 per cent from the previous week, and 50 per cent from the same period a year ago.
And in another blow, the flow of milk to Nova Scotia — where roughly 25 per cent of local milk is shipped — practically stopped because the market in that province has also seized up.
So that created a situation where the volume of milk far exceeded demand, and left farmers with no choice but to discard large quantities.
"It's a huge hit," Williams said.
The situation prompted Fisheries and Land Resources Minister Gerry Byrne to lash out at retailers for their decision to reduce orders and restrict purchases.
That prompted a sharp response from the Retail Council of Canada, with a spokesman telling Byrne to lay off the rhetoric and let the "experts in supply chain management" take care of their own affairs.
Williams was more measured in his response, saying multiple factors contributed to the situation, including an inability to ship surplus milk supplies to Nova Scotia, where the production of products such as cheese and yogurt has fallen.
As retailers get a better handle on the new reality brought about by COVID-19, Williams believes the limits will slowly be lifted.
But Williams is not happy with the purchase limits, saying the supply of milk is robust and limits could force some consumers to venture outside more often, which is contradictory to the recommendations of public health officials.
"The consumer should be able to buy what he wants," said Williams.
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