Chobani absolves supply management

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When both sides of a failed negotiation claim "it isn't about the money", it always has everything to do with the money - therefore when both sides in this dispute claim Chobani's failure to build a yougurt plant in Canada "has nothing to do with supply management", it has, of course, everything to with supply management. In addition, the first rule of public relations is to never, never, never, "burn bridges" in public, especially when there's still a chance to far-more enjoyably, and privately, "burn someone at the stake" later. Therefore, Chobani would never say anything bad about supply management in public, even though, given the torture they've endured over the past year, including the spending of over $1 million in legal fees to fight the the people in the supply management system, the very people who would benefit from this plant, who could blame them, especially since their new plant in Idaho, which was supposed to open at the same time as the one in Kingston, is already long-since up and running, and using 5 million pounds of milk per day?

Stephen Thompson, Clinton ON

Chobani has proven they are no fools when it comes to business and there is obviously no advantage to them to "burn any bridges"...that is give SM the trashing they deserve in this travesty.
The questions I would ask are, would consumers have the choice to buy Chobani yogurt if SM disappeared tomorrow...or would more milk be produced in Ontario without SM...or would there be more opportunity for milk producers without SM?
Then again how many jobs would be lost if this huge beauacracy of SM were to disapear...would that put a bunch of lawyers and lobbyists out on the street?
We look at the bungling of the government beuacracy costing taxpayers huge dollars...this example is right up there.
Dave Linton

Even though he was a nut-bar, and a complete tyrant, China's Mao-Tse-Tung may have had a point with his disastrous program to send the elites to the country-side to do manual labour. It would be only appropriate, therefore, for the federal government to step in, guarantee Chobani the milk supply needed, guarantee them an ethanol plant-style profit, and then force ALL the senior people in the Canadian dairy industry, as well as all the Quebec dairy farmers who went to Montreal to protest Chobani's original import permits, to work in the Chobani plant, for a year, for free, as punishment for being so obtuse about it all in the first place. Oh, yes, and of course, the feds would force DFO to sell Chobani all the milk they need, at US wholesale prices, just to rub it into all the other yogurt manufacturers, and everyone else in the Canadian dairy industry, for being complete jerks. I'd like it so much I might even start buying yogurt.

Stephen Thompson, Clinton ON

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The Chobani blog,at chobani dot com, says the need 31,000 cows/day and that the average Idaho cow makes 65 lbs./day. Thats 2,015,000 lbss/day. It also says more than 1 billion pounds per year which is 2.73 million pounds/day. Take it for what it's worth but its a long way from your stated 5 million Also agweb dot com reported the plant held it's grand opening on Dec. 17th/2012. So has it really been "long-since up and running"?
Or perhaps we shouldn't cloud the discussion with facts?

According to Ian Cumming's article in the January edition of - "The Idaho plant is now receiving five million pounds of milk per day and manufacturing 4.2 million cases of yogurt per week". If I didn't properly cite my souces, mea culpa, but since the construction of the Idaho plant, and the proposed Kingston plant, were both announced at effectively the same time, and since both plants were supposed to be the same size, it doesn't matter whether the Idaho plant's daily intake is 2.73 million pounds, or 5 million pounds, either amount is still just that much more than they are buying in Ontario, and will be, for probably a long, long, time. In addition, you've been a tad slippery with the truth because you didn't ever say what the Chobani plant in Idaho actually used, you made an unsubstantiated "leap-of-faith" to conclude that the Idaho average production was what CHobani was actually buying, and that may not be correct. Chobani could be buying the production of 31,000 cows which do produce 5 million pounds of milk per day, but you have not considered that possibility - I will apologize if there is no way 31,000 cows could produce 5 million pounds of milk per day, but I want to make a point that using State or Provincial averages to make this type of "leap-of-faith" conclusion can be, and often is, misleading, and is all-too-indicative of the increasing desperation on the part of dairy farmers to come out of this mess not looking like something that fell out of the north end of a south-bound cow. As far as criticizing my "long-since up and running" comment, when compared to the strong possibility that the Chobani Kingston plant will never be "up and running", I still suggest my comment is completely appropriate, deadly accurate, and then some. Why don't you dairy farmers do something positive by chewing out your own people instead of anonymously posting snarky comments here?

Stephen Thompson, Clinton ON

I would love to know how much the DFO paid the law offices of Wilson & Spurr the past year to defend this out of date system,

Sean McGivern

According to Ian Cumming's column on page 7 of the January issue of, - "By the time snowflakes started to fall last November (2012), more than $1 million in legal fees had been paid out on each side - "each side" being all the players infighting within the dairy supply management Canadian sphere." Imagine the benefit to consumers if this money had, instead, been spent to actually give consumers more choice, and a better price. Therefore, with people like the Canadian dairy industry as their supposed friends, why would Chobani need enemies?

Stephen Thompson, Clinton ON

It may well be that with all this huff and puff fluff about ending SM in Canada that they did not feel that they could secure a long term price that they could rely on . Look at the the possibility of the price of milk going more than double if the US dairy farmers loose the support they get from the US Farm Bill .

These companies do their home work and would well know that so many things can bought cheaper in the USA than in Canada even when exported from Canada to the USA . Labour is cheaper there , likely taxes , hydro and much more .
The cost of the milk is likely not the biggest factor because the yogurt would not be priced the same here as there . Look at the price difference for corn and soys and farm equipment parts . As a so called economist you are fooling yourself and others to think we are the same north of the border .

The only foods Canadian consumers go to the US to buy, are dairy and poultry products, period. I really, really, really, hate it when EVERY supply management supporter not only ignores the fact that DFO, and virtually everybody else in the supply management system, spent almost 40 years claiming cross-border retail price equivalency for dairy and poultry products, but they now pretend it was all a bad dream. It's all part of the supply management double-standard people - SM supporters will beat you to death with any weapon they can find, yet they'll move on to the next "weapon" at the drop of a hat, and studiously pretend they didn't spend 40 years beating you with the last weapon, but that the weapon never existed in the first place. As long as DFO was boasting about cross-border retail price equivalency, no supply management supporter ever mentioned anything else - yet, now that cross-border retail price equivalency effectively, in the minds of supply management supporters, never happened, they fall back to the next stupid argument which is that "everything" costs more in the US, and that is nonsense. As an example of the out-right stupidity of the arguments of supply management supporters, corn and soybeans cost more here than in the US at those times when we are net importers, but there are also times, particularly during harvest, when we are net exporters, and, therefore, corn costs less here than in the US. The same thing applies for hogs and livestock - they cost less in Canada because we are net exporters. I mean, come on, already, do some homework yourself, because you don't have any idea at all what you are talking about. And, double get-over it already, your understanding of the US farm bill for dairy is completely dead-outright wrong - there is, as of now, absolutely no chance that US milk prices are going to double, either with, or without, support from the US government. Once again, I really hate it when supply management supporters seize every out-of-context story coming out of the US, as a reason to defend supply management. I wish that, just for once, supply management supporters would focus on the undeniable, and ultimately fatal flaws in supply management which are the facts that they, and they alone, benefit from 200% plus tariff barriers which squarely pit them against both consumers and other farmers - nothing else matters, or will ever matter.

Stephen Thompson, Clinton ON

Did I say I was a supply management supporter ? I simply stated some other real facts that very well could be the reason behind the company not opening a plant here . This is not the first company not to open or build a plant here . I can think of one at Hensall that never got built . You forgot in your post/reply to mention that I must be a CFFO supporter . I may well be a supporter of the other GFO that you belong to who I can guarantee IS a SM supporter .

Further you didn't comment on the fact of farm equipment parts , labour , taxes etc. being cheaper . As for G&O crops .. with a par dollar , an open border and free trade there is no reason I should not get the same price for my products . My fertilizer , seed and chemicals cost more here in Canada .

It is nice to see that I can wind you up tighter than I did the spring in Granddads old pocket watch . Heck I too may be a member of that " other " group you belong to . Could it be we went to UWO together ?

Anyone who claims, suggests, or even infers, that corn and soys are cheaper in the US, and/or who doesn't seem to understand that we're talking, in this context, about basic food products, including beef and pork which are, in Canada, effectively priced on an export basis, doesn't deserve any of my time. It isn't about what else may be cheaper, or more expensive in the US, the only point is that we, in Canada, have stupidly allowed 200-300% tariff barriers to exist solely for dairy and poultry products, where they remain as an island of by-gone stupidity, as well as a mill-stone to both consumers and non-supply managed farmers in a world where tariffs, and more-importantly, the mentality behind them, has long-since ceased to have any credibility, except of course in the fairy-tale world of Canadian agriculture. I get calls, and e-mails, almost every day from farmers, young and old, who are completely disgusted with, and by, everything supply management represents, but nothing disgusts the people who call me, more than the smugness of, and the patronizing attitudes of, as well as the completely-irrelevant arguments proffered by, supply management supporters. Insofar as complaining about the cost of parts for machinery, that is such small beer in the scheme of things, for anybody, especially since the advent of on-line shopping, and the ability to purchase many parts for all makes of machinery from companies like A&I, it's so much of a non-issue when compared to 200% plus tariffs, it's a complete red-herring. I'm glad you can afford to pay more than you need to pay to buy dairy and poultry products, and I'm glad you obviously aren't affected by the land-buying bullies in supply management, but over 30 million consumers, especially the poor ones, and most non-supply managed farmer would jump at the chance to do without being forced to subsidize, or be patronized by, 15,000 supply managed millionaires.

Stephen Thompson, Clinton ON

When I wrote "everything costs more in the US", it should, of course, have been "everything costs less in the US" - Sometimes the arguments of supply management supporters are so stupid, it's hard to not make grammar mistakes in response.

Stephen Thompson, Clinton ON

I,m a Canadian Consumer and I don,t go south to buy dairy or chicken, we buy it in Canada and only go south to buy something you can,t find up here. Go vegan and you won,t have to worry about the sm farmers they will all disappear and you wont have to complain about them. Look at the manufacturing of a lot of farm produce not processed or manufactured in Canada any more , its terrible the processors that left this country because of low tariffs. Well folks I guess some has a or wants a CANADA FOR SALE sign on it I,m for one wants jobs here in Canada in farming and manufacturing not just in sales or government. Well I,m ready to hear the same comments from at least 3 people out of the 33,000,000 + people in Canada. MADE AND GROWN IN CANADA

Wake up and look ,the other countries want Canada to get rid of SM so they can control all of the agriculture in here. If you hate it that bad get a petition up to rid this country of the sm farmers. You preach like everyone is getting screwed look at the price of everything up here its outrages not just for SM produce. Maybe the government should own everything or just one company and they should be able to keep the price at a give away. Bet if you had quota you wouldn,t be screaming at everyone to get rid of it .

You are completely ignoring the obvious fact that dairy and poultry products are unique in their ability to hide behind 200% tariff barriers - nobody, and/or nothing else in Canada has that ability. Just for the record, I don't mind paying what I have to pay for whatever, as long as I'm not having to climb over a tariff barrier to do it. That's why I couldn't care less what the price of plow points is because they aren't protected by a 200% tariff barrier, and also because there is no possibility of pitting farmer against farmer. I really hate people whining about what things cost compared to wherever, because if this whining made any sense, we wouldn't have any hog or beef industry in Canada at all - they're both still here, continuing, even in spite of ethanol and the bullies in supply management, to feed grains priced on an import basis to hogs and cattle priced on an export basis (the worst of both worlds) because they got better at what they do, and there's no reason dairy and poultry farmers couldn't do exactly the same thing. In addition, I never cease to be amazed that supply management proponents constantly complain about the spectre of foreign control of our agriculture, yet can't understand that through supply management, we're already controlling our consumers in a far-more draconian manner than any foreign entity could ever do to us. I've also gotta remind people that this argument is moot anyway - non supply managed farmers under the age of 40 have long-since decided supply management has to go, and it's only a matter of time before they have the numbers to put supply management in the garbage can.

Stephen Thompson, Clinton ON

Actually there IS a reason poultry producers couldn't exist in Canada without supply management. Hint- it's the same reason there's practically no poultry industry in the US roughly north of the Mason-Dixon Line - climate. A friend who raises broilers tells me winter heating costs are in the neighbourhood of 40% of his cost of production - producers that have to heat their buildings in the winter simply can't compete with those who don't.
Which shouldn't be taken as an argument in favour of SM - just the opposite. If Canadian producers can't compete based on geographic reality they shouldn't be propped up.

More to the point, every Thursday night I go to the Blyth Hotel to eat Brazilian chicken wings - meaning that even the Mason-Dixon line, thanks to North America's nonsensical love affair with ethanol, is too far north to provide an economic rationale for raising chicken. It all seems fair - Saputo builds dairy processing plants in Brazil because the Canadian dairy industry, thanks to supply management, is stagnant at best, while we, in turn, import Brazilian chicken wings which, even with the tariff, are still a better deal than chicken wings which could almost literally walk from the farm into the hotel kitchen. The only response supply management supporters seem to be able to muster in response to this type of colossal nonsense, is to fearmonger that any chicken not produced under supply management, isn't safe to eat - yeah, right, and tooth fairy is going to leave 10 units of quota under my pillow tonight.

Stephen Thompson, Clinton ON

You mean they drink milk in Brazil ?
Do they eat yogurt too ?

I heard once that they raise hogs in barns with no fans and only 4 lightbulbs per floor run off of solar . 2 floors and about a km long . Wonder what regulations they are under ? NMP, EFP , ????

You didn't think Santa was going to leave you a blonde under your pillow ! A stork might leave you a leprechaun .

Recently, I had the privelege of meeting a former dairy farmer from the Stratford area, who came through my shop for my services. He now specializes in ventilation, all natural, and mostly for swine facilities in the amish and mennonite areas. He has developed controls that operate off battery and solar power, as you mentioned, and only require a small standby generator to top up the batteries when needed. There are no fans. It is my understanding that these hogs would be raised under the CQA programs also. Raube Beuerman, Dublin, ON

It is becoming increasingly clear supply management supporters, when they can't think of anything else, typically proffer two arguments to support their position, and both arguments, of course, have nothing to do with either good economics, or common sense:
(1) any food which is imported, but which could be produced by supply managed farmers here, is unfit to eat - the fear-mongering ploy.
(2) anyone who doesn't support supply management, including cross-border shoppers, and people who, like Ian Cumming, move their dairy operations to the US, are un-patriotic.
Unfortunately, we're starting to see ample evidence that when people are in a corner, and can't defend, on any rational basis, the legislated entitlements which give them an advantage over almost everyone else, they will fight to death, using any means, fair or foul, usually foul (see (1) and (2) above) to do so.

Stephen Thompson, Clinton ON

I spoke yesterday with a Chobani official who said in their email post to me that "circumstances out side of their control are preventing them from staying on the shelfs here in Canada" What could that be ? it isn't financial reasons they have the cash to build a plant, they have a location, they had even post job adds that were taken down. what else could it be, what could it be ? other then the foolish out dated supply management system we have, that sheleters and protects a the elite farmers and processors on the back of society ???
If dairy farmers them self's are not finally annoyed with their DFO board of directors, for allowing this to happen, then shame on you independent dairy farmers for allowing this market growth to be taken away from you, if you don't want to produce the milk, move out of the way i know lots of young farmers who are willing to start right away and can supply that milk. You are allowing your future to be written by some body else, its these types of stunts that just go to show that Dairy Farmers dont run the DFO its a few multinational dairy processors who run the DFO, but let a few middle aged babay boomer men think they are in control and give them these titles as directors,ha directors, these fools couldnt direct a one man float in a one float parade on a one way street, what a joke.
We need a provincial inquiry into the handling and management of the supply management sectors, Some thing has gone a miss here, look at the state of the dairy and feather sectors, the dirty business at the Egg farmers of Ontario and not allowing a new major dairy processor into Ontario, this all stinks of corruption,
if it walks like a duck and talks like a duck and it looks like a duck, there's a good chance its a duck.

Sean McGivern

At the same time they're investigating the Chobani mess, they could examine why, as per a recent article in the Vancouver Sun by reporter, Don Cayo, BC egg producers/processors import cheap US eggs, and then sell them at much-higher BC prices, but complain when BC consumers travel to the US to buy eggs for themselves. In exactly the same way Gerry Ritz once quipped - "the NFU never misses an opportunity to prove they are completely out of touch with reality", the same thing could be said about everybody in, and everything about, supply management. I suspect the Chobani thing isn't over, and for supply management supporters, I suspect it's going to get a lot worse before it gets any better.

Stephen Thompson, Clinton ON

Could it be that certain other processors that fought hard to deny milk to the Chobani simply paid the grocery chains not to give Chobani a sku for the yogurt, denying them a place on the store shelf? Since DFO says they can have milk that is the next reasonable way to stop a competitor if you have the money. Seems the fight might be less about Supply Management and more about big processing companies not liking competition. Killing Supply Management is NOT going to make that any better.

John Gillespie

John, lets remember that the Boards like the DFO could have easily put in place
caps on the volume of processing quota, so that one processor could not own the massive volumes of processor quota they do, but no they have allowed these processors to become Giants by not limiting their size and buying out every small processor they can. To bad most of these processors aren't Canadian owned.

I have never once heard one marketing board ever say that they need to do some thing about the size of the processors, they like the idea of only having a few processors it makes their job of billing and controlling every thing that much easier with few players.

The marketing boards could have come up with all kinds of ways to help foster growth and create an enviroment that fosters innovation and allows for new processors to start up, by creating new speicalty processor quota with a zero dollar value this way its no benefit for small processors to sell out for big money.

Look at how hard the DFO fought to stop the dairy drink maker from starting up in Milbank, look at Chobani, they should of rolled out the red carpet and did anything they could to help bring Chobani to Ontario, instead the DFO is more concerned about protecting large multination corporations then they are about what is actually really good for Ontario Farmers, A few years ago the Rural Voice published an article called "Missed Opportunities" it talked all about the ongoing loss of market share because of the way the DFO is working hard to protect status quo.

I think some people live in a utopia when it comes to their views on supply management, its not some little family farm with a few thousand chickens out on pasture being sold to some family owned local butcher shop, its a big business that has had portection for 50 years, now like the rest of agriculture its time for it to stand up on its own to feet and if i can't maybe it should go the way of buggy whip maker and let the next generation of innovative farmers fill the needs that the current SM farmers say they couldn't with out a monopoly.

Sean McGivern

Its not just milk look at the eggs there are a couple of giants that rule the roost and the government hands them money besides to get better equipment so the small guy disappear . Sm is good but its run by the big companies or farm whatever you want to call them and there is really no stopping them. Like I keep asking the 3 that hates sm so bad what do you propose the people of Canada do to stop the monopoly of the big guys.

A friend operates one of only two businesses of its type in Ontario, and advises me competition is fiercer now than what it was 30 years ago when there were ten companies competing for sales and market share. Farmers just don't understand the realities of business - one of those realities is that since DFO admitted in late 2010 that the farm gate price of milk in Ontario was within pennies per liter of the US retail price, even if milk processors, distributors, and retailers in Onario did everything for free, the retail price of milk would only be about 3 cents per liter less than the US retail price. The problem, therefore isn't with the monopoly of processors, distributors, and retailers, it's the monopoly enjoyed by farmers - eliminate that by eliminating supply management, and everything falls into place.

Stephen Thompson, Clinton ON

You do realize that the example of eggs you just used as being a giant is a true "monopoly" by definition, don't you? And if you do, I am not sure I understand what it is you are trying to say with that post. Raube Beuerman, Dublin, ON

The previous poster was trying to say that he/she believes oligopolies/oligopsonies are bad, in spite of there being no evidence whatsoever to justify that kind of claim, but that monopolies, when run by farmers, are good, in spite of the abundance of evidence to prove that monopolies, run by anyone, are bad. It is, of course, a classic case of fear-mongering, as well as long-standing NFU-style double-think, in an attempt to promote the belief that monopolies run by farmers can do no wrong. When people are in a corner, and desperate to come up with a way, any way, to save their ability to have a legislated edge over others, this type of double-standard is the sort of thing they always conjure up.

Stephen Thompson, Clinton ON

Does not SM have the largest percentage of young farmers of any group . Guess that speaks volumes .

Your comment proves beyond a shadow of a doubt that you are not a non-supply managed farmer under the age of 40 from Huron County. The presence of young, supply management farmers, means that "daddy" used some of his unfairly-earned income and purchasing power to bully a young, non-supply managed farmer out of a farm, period. What is it about the inequality generated by 200% tariff barriers, and its effect on the land-buying ability of our rural aristocracy that nobody in supply management seems to be able to understand?

Stephen Thompson, Clinton ON

That is simply not true, SM does not have the higest number of young farmer.

Sean McGivern

If you haven't heard of companies buying shelf space in grocery stores you might as well stay under the rock you were under . It is a fact of life in the retail sector .

Im a dairymen in Ontario. These are my opinions only! Sm was brought into place in mid 60s. My grandfather made many trips to Toronto lobbying for a marketing board.the boards purpose was to create fair market value for their milk and to grow our market. He would be very disappointed to what we have created today! We have no market growth and we are selling the same amount of milk before we had supply management! I see a stronger division between sm and non sm farmers more then ever! Simple math we give you a conclusion that there is a train wreck coming for sm! Dfo claims that the consumers are in favor for sm but my argument to that is most of the pop in this country have no clue what ot really is! Does anybody think that mcdonalds would have the same success today if they were selling the same amount of product compared to when they started over 40 years ago? When you combine no growth milk prices surging and our country's population has doubled what has our board accomplished? Now as people have stated our quota compared to a Tim hortons franchises Im sorry you dead wrong! The only thing they have in common is the both cost lot of money. When you buy a Tim's you are not guaranteed sales like you have with quota and its also up to the owner to drive the store and make it a success! So when you look at what our milk market faces in the future it really is a fog to me! At the end of the day somebody has a royal flush that will take down the house! Its just a matter of time. Just to remind everyone the unsinkable titanic is in fact at the bottom of the ocean. I try to buy quota every month i try to expand and i try to get some truth! And to be clear Im not for the status quo or against it ether! I do believe our industry needs to address the problems we have if in fact we want sm to survive. But if we don't i fear our industry will start goin through its own cannibalism. I do infact believe our industry would be more vibrant and aggressive in market's if our board never allowed money to be exchanged for quota. Just stop and look what we have created and think about it!

Every dairy farmer in Ontario should be disapointed with the outcome of the Chobani situation. Recently, while reading comments posted under one of Andrew Coyne's articles, I came across a particular comment. "Northern Vigor", is his internet name, and he is/was an Ontario dairy farmer who claims he was told by the head of milk quality on the milk board, that their goal is to eliminate 2000 dairy farms, and he is one of them, and then after that another 2000. If you read his other posts, it is quite obvious from his knowledge of numbers that he is or was indeed a dairy farmer. Raube Beuerman, Dublin, ON

I regularly get calls from supply managed farmers who tell me exactly the same things you have posted here, and all of them tell me their greatest concern is for the next generation, not just for those in supply management, but also for those farming outside of supply management. I'm also old enough to remember the tractor parades in the mid-sixties, and I remember that most of the milk shipped then, was shipped in cans. In any aspect of life, or business, the reason something was introduced is not automatically a good enough reason to not get rid of it later - for example, there was a good reason to have gotten rid of supply management when the industry changed from cans to bulk, but, even by that time, the mentality of greed had taken over, too bad for us all.

Stephen Thompson, Clinton ON

Mr. Thompson agrees that the system should not be destroyed but should be changed !!
You all read it here on BF .
Well it's about time !! Welcome back to reality Stephen .

There is absolutely no way anyone reading my posting would, or even could, conclude I had changed my mind to suggest that supply mangement should be changed, rather than be eliminated. The complete leap of faith you made when jumping to your erroneous conclusion, is indicative of, firstly, the startling lack of reasoning ability on the part of supply management supporters, and, secondly, the ever-increasing desperation they demonstrate when trying to come up with anything, other than fear-mongering, and mis-guided patriotism, to defend supply management.

Stephen Thompson, Clinton ON

In today's Kingston news paper the Whig Standard. The CEO of KEDCO (Kingston Economic Development Corp) puts the blame for Chobani pull out on SM system. check it out

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