DAIRY NEWS
DFO FOCUSED ON PROFITABLE, GROWING DAIRY INDUSTRY Editor’s note: Dairy Farmers of Ontario (DFO) held its annual general meeting virtually on Jan. 19, 2022. More than 600 guests, including producers, processors and industry partners, joined DFO’s Board and staff to receive industry updates from DFO and industry leaders. This article provides a brief highlight of the presentations. To watch the year-in-review video, visit DFO’s website at https://bit.ly/3ATAtj8.
D
airy Farmers of Ontario’s (DFO) board was very engaged in tackling issues throughout the past year, with the overall goal of sustaining a profitable, growing dairy industry, says Murray Sherk, DFO’s chair in his opening address. “We continued to execute on the immediate needs of our farms, supply chain and staff while staying focused on our longer-term vision. There were many instabilities in demand for dairy products, but there were some encouraging results last year,” Sherk says. Some highlights in 2020-21 included dealing with the ongoing fluctuating demand for milk and adapting to a changing marketplace, ensuring there was enough milk for innovation and growth, implementing the proAction environment module, as well as working on DFO’s sustainability strategy. Partnerships were also a key focus area this past year, with DFO increasing its collaboration with the Ontario Farm Products Marketing Commission, Ontario Dairy Council, Ontario Milk Transporters Association, the University of Guelph and Dairy Farmers of Canada. With the effects of dramatic weather events, the pandemic, supply chain disruptions, high
commodity and fertilizer prices and political tensions, it has become near impossible to forecast what’s ahead for 2022, Sherk concedes, adding the board will continue to focus on achieving sustained market growth, with particular attention on consumer buying patterns considering the recent price increase. “Consumers today have more dairy alternatives available to them than ever before and if we want them to keep buying real dairy products, we need to be listening to what is important to them; and for many that is an emphasis of transparency, environmental sustainability and animal welfare,” he says. Cheryl Smith, DFO’s chief executive officer, echoes Sherk’s view on providing transparency in the industry. “This year, we will work to grow our influence and credibility, to reinforce a culture of accountability and customer service, and to increase productivity,” she says during her business update. Canada’s supply management system has shown its resilience and flexibility to deal with market volatility during the pandemic and has put the sector in a strong position as it continues
DFO’s 2020-21 fiscal concluded with a $1.6 million surplus. Revenue were favourable to budget by $600,000, of which $400,000 was from licence fee revenue increases, says Rey Moisan, DFO’s chief financial officer.
Looking at the current fiscal year (Nov. 1, 2021 to Oct. 31, 2022), DFO is forecasting a $900,000 deficit. There will be no increase to licence fees. Revenues are budgeted to increase by $500,000 due to a 3.1 per cent budgeted increase in production volumes and a small increase in interest income. However, expenses are budgeted to increase by $3.2 million to $23.2 million and capital expenditures are expected to further decrease by $200,000 to $580,000.
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EARLY SPRING 2022 | MILKPRODUCER
HIGHLIGHTS OF DFO’S BUDGET
Expenses for the fiscal year came in at $1.7 million favourable to budget, but in line with 2020 results. Capital expenditures were $450,000 favourable to budget, comprising $250,000 favourable in the general fund and $200,000 in the marketing fund.
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to face uncertainty, she says, adding DFO remains anchored in its objective to increase dairy consumption across the province by continuing to make dairy an inspired food choice with consumers. Given recent data from NielsenIQ, both Ontario’s and Canada’s dairy industries are poised to continue benefitting from increased dairy consumption throughout 2022. According to keynote speaker Francis Parisien, senior vicepresident of sales for small and medium businesses in Canada for NielsonIQ, 62 per cent of Canadians are still cooking at home instead of eating out due to the pandemic, which is not expected to decrease any time soon. He adds outlook and growth opportunities remain positive for dairy categories in Canada. “Canadians are telling us they will continue to spend on dairy products, such as breakfast categories and coffee … this is a great opportunity to get into cross-marketing opportunities in the coffee department,” he says. “Forget about going back to normal, it’s about being innovative and adapting to a changing market.”
“There are always uncertainties in budgets. We monitor results monthly and update our forecasts,” Moisan says, adding DFO reviews risks and opportunities for both revenues and expenditures and adjusts plans accordingly.
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