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Revolutionary $75M Dewatering Dairy Plant to Transform Milk Processing in Alberta by 2025

Learn how Alberta’s $75M dewatering dairy plant will transform milk processing by 2025. Will this new technology reduce costs and improve sustainability for farmers?

Alberta, Canada, is set to open the first-of-its-kind, a revolutionary $75 million (€50.4 million) ‘dewatering’ dairy processing factory in the spring of 2025. This innovative facility is poised to revolutionize milk processing, significantly impacting the Canadian dairy sector. With its creative ultra-filtration techniques, the factory aims to enhance sustainability, reduce transportation costs, and streamline manufacturing, paving the way for a more efficient and eco-friendly dairy industry.

Henry Holtman, board chair of Dairy Innovation West, believes “this plant is a transforming step towards a more efficient, eco-friendly dairy industry in Canada.”

The new facility is a game-changer for central Albertine dairy producers, who have long grappled with limited local milk processing capabilities. Over 1,300 farmers stand to gain from this development, as it will enhance their operations and transform the financial landscape of the area’s dairy industry, thereby bolstering the local economy.

A Proactive Coalition: Uniting Dairy Marketing Boards for Revolutionary Milk Processing in Canada 

Five leading dairy marketing boards—Alberta Milk, SaskMilk, Dairy Farmers of Manitoba, BC Milk Marketing Board, and BC Dairy Association—have joined forces in a bold initiative to revolutionize milk processing in Canada. This collaborative effort, under the banner of the Western Milk Pool, is a testament to the sector’s unity and power, and it is poised to address industry challenges and stimulate local businesses.

Farm Credit Canada’s backing provides essential money and agricultural economic knowledge. This alliance guarantees a strong financial basis and offers expected major advantages, like fewer transportation emissions and possible savings of $5 million.

Dairy Innovation West: Leading the Charge in Alberta’s Dairy Processing Revolution

Dairy Innovation West is Leading Alberta’s brand-new dewatering milk processing plant. Supported by five Western milk marketing boards, this company seeks regional environmental, economic, and technical advantages.

“This plant will create jobs, lower transportation costs for producers, and reduce our environmental footprint,” Henry Holtman, board chair of Dairy Innovation West, emphasizes as the main benefits of the endeavor. These advantages represent our commitment to Western Canada’s ecological and financially feasible dairy production.

The Revolutionary Dewatering Strategy: Transforming Canada’s Milk Processing Landscape 

At this innovative plant, the cutting-edge dewatering system concentrates up to 300 million liters of milk yearly using sophisticated ultrafiltration. This technique removes certain soluble components and water from raw milk using semi-permeable membranes, preserving important milk solids such as proteins and lipids.

When milk passes ultrafiltration, its volume may drop up to 75%. After that, concentrated milk is a flexible basis for many dairy goods. It may be dried, for example, to produce skim milk powder, prized for its long shelf life and simplicity of transportation.

Furthermore, condensed milk helps cheese manufacture by means of better yields and simplified procedures. This invention benefits butter manufacturing, as a richer cream base improves both product quality and efficiency.

This innovative approach maximizes classic dairy products like skim milk powder, cheese, and butter. By lowering the amount of milk carried, it lowers the environmental impact and saves transportation expenses for farmers and processors. It also increases sustainability and cost-efficiency.

Revolutionizing Transportation: ultra-filtration’s Role in Dairy Efficiency 

At the new plant, ultra-filtration marks a significant development in transportation efficiency. Concentrating up to 300 million liters of milk yearly helps drastically lower the liquid volume requiring transportation. Estimates indicate that 50–75% of the necessary truck trips might be avoided, saving manufacturers $5 million yearly. This efficiency is vital for central Alberta dairy producers, who already pay expensive shipping charges because of inadequate local processing. With the new facility, local farmers could anticipate better profitability and a more environmentally friendly dairy business.

Long forcing producers to transfer their raw milk to far-off provinces like British Columbia, the lack of milk processing facilities in central Alberta has long caused expenses and delays. Comprising up to 300 million liters annually, this new dewatering facility seeks to solve these problems. Means of ultra-filtration technology will lower environmental effects and shipping costs, enabling a significant step toward economic sustainability for Albert’s dairy sector.

Empowering Dairy Farmers: The Rise of On-Farm Milk Processing in Ontario and Beyond 

Driven by the need for more control over product quality, marketing tactics, and financial returns, the trend of on-farm milk processing is expanding in Ontario and Canada. One such prominent example is Summit Station Farm in Ontario. Establishing their processing plant, they create a variety of dairy products—including milk, yogurt, and handcrafted cheeses—sold straight to customers and neighborhood businesses. This approach lets the farm leverage customer tastes for local, farm-to-table products and lessens reliance on conventional dairy cooperatives.

The more control Summit Station has over its goods, the better its standards of quality and consistency are guaranteed. Hence, one main advantage for them is That They Respond to customer needs more successfully than more centralized processing facilities. On-farm processing also provides the freedom to develop and swiftly launch new goods in response to market trends.

Summit Station may also customize its marketing plans to appeal to nearby customers, strengthening brand recognition and creating a devoted clientele. This direct-to-consumer approach creates stronger customer ties, as consumers value the openness and authenticity of buying straight from the manufacturer.

On-farm processing may significantly enhance a farm’s bottom line by obtaining better margins on processed goods than raw milk sales. This strategy guarantees a more consistent and durable income source and helps reduce the hazards connected with changing milk prices.

The trend toward on-farm milk processing enables Ontario and Canada’s dairy producers to take back control over their output and marketing, strengthening and adjusting the dairy sector.

Innovative Diversification: Enhancing Financial Stability Through Agritourism, Renewable Energy, and Value-Added Products 

Dairy producers dealing with low milk prices and expensive feeds must diversify to survive. Many look beyond on-farm processing for agritourism, renewable energy initiatives, and value-added goods such as yogurt and handcrafted cheeses. Their public farm openings provide fresh income sources and encourage community involvement in dairy farming.

Solar panels and methane digesters can also help lower energy bills and generate revenue by selling excess energy back to the grid. Government subsidies and incentives for sustainability help offset starting expenses, benefiting the environment and earnings.

From the University of Minnesota, Dr. Marin Bozic emphasizes the need for creativity in finding new sources of income for dairy farms. “Innovation will enable more traditional dairy farms to incorporate diverse revenue sources,” he says, strengthening resilience and profitability. Maintaining competitiveness demands embracing new technology and business concepts. These approaches signify a turning point for the dairy sector as they guarantee economic viability and help sustainable development and environmental stewardship.

The Bottom Line

With the $75 million dewatering milk processing plant Alberta is building, she is poised to transform her dairy sector. Supported by five western milk marketing boards and driven by Dairy Innovation West, this facility will increase operational efficiency, boost farmer profitability, and promote environmental stewardship. Using sophisticated ultra-filtration technologies will considerably lower transportation expenses and ecological effects while generating employment and strengthening the area’s economy.

Reflecting a trend wherein farmers progressively manage their production and marketing channels, on-farm processing devices enhance these creative approaches. This change provides financial resilience and sustainability in line with professional opinions that say the future of conventional dairy production depends on diversification and innovation.

Alberta and beyond will be greatly impacted as the facility approaches its spring 2025 launch. The help and investment of stakeholders will be crucial in boosting the community and guaranteeing the survival of dairy farming in Canada. Working together, we can change the scene of dairy farming for future generations.

Key Takeaways:

  • Alberta, Canada, will host the first ‘dewatering’ milk processing facility in the country by spring 2025, with a $75 million investment.
  • The plant is co-owned by five western milk marketing boards and supported financially by Farm Credit Canada.
  • This facility will process milk from over 1,300 farmers, offering job creation and environmental benefits.
  • Dewatering will concentrate up to 300 million liters of milk annually, reducing transportation costs and environmental footprint.
  • The plant addresses a critical gap in milk processing capacity in central Alberta, previously necessitating transport to distant provinces.
  • On-farm processing is gaining traction as a strategic response to industry challenges, with examples from Ontario, Canada, and the US.
  • Diversification, including agritourism and renewable energy, is vital for enhancing the financial stability of dairy farms.

Summary:

Alberta, Canada is set to open a $75 million dewatering dairy processing factory in spring 2025, aiming to improve sustainability, reduce transportation costs, and streamline manufacturing. The project will benefit over 1,300 farmers and boost the local economy. Five leading dairy marketing boards, including Alberta Milk, SaskMilk, Dairy Farmers of Manitoba, BC Milk Marketing Board, and BC Dairy Association, have partnered to revolutionize milk processing in Canada. Farm Credit Canada’s backing offers fewer transportation emissions and potential savings of $5 million. Dairy Innovation West is leading the new dewatering milk processing plant, which uses ultrafiltration to concentrate up to 300 million liters of milk yearly. This process preserves important milk solids, reducing environmental impact and transportation expenses. On-farm milk processing in Ontario and Canada is driven by the need for more control over product quality, marketing tactics, and financial returns. Summit Station Farm in Ontario uses this approach to create various dairy products, such as milk, yogurt, and handcrafted cheeses, sold directly to customers and neighborhood businesses.

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Are We Playing Hide and Seek With Supply Management?

When it comes to supply management, many proclaim to know the absolute truth. They either profess “It will never be sold out.” or they’re emphatically on the other side stating “Supply Management is dead!” (Read more: Why the Future of the North American Dairy Industry Depends On Supply and Demand) Unless you can read the minds of the politicians (and even The Bullvine won’t pretend to go that far), you are putting your future in someone else’s hands.

Come Out Come Out Wherever You Are!

The issue of supply management raised its head in the late 60s. Many think that once implemented that’s all there was to it! WRONG.  In 1976 the MSQ was decreased by 18% in response to a serious surplus of production.  RIGHT MOVE. Then later on the word was out that Supply Management was coming to an end. Some prepared instantly. WRONG.  Today many aging dairy farmers want to retire … but their children are not sure whether the “security” their parents had is going to continue.  Others worry that a closed off dairy industry will be unable to provide the opportunities they’re looking for.

In the Beginning

Supply-management was introduced by the federal government in the 1970s as a way to ensure local farmers could meet domestic demand and be rewarded fairly for their effort.  The introduction of quota levels helped to control supply while creating stable prices for Canadian consumers. Prices for milk worldwide had led to fluctuating prices and instability in Canadian markets.  The government sought to fix this by implementing a system to provide milk and poultry for the Canadian market by Canadian producers.

Is Government the Game Changer?

Why do we modern day business people never ask ourselves what our parents did to adapt to change? Unlike them – we accept that their solution is “forever”. At a certain age somewhere between 40 and 65, we assume that we have done all that there is to do and the way things are right now is the way they should remain…. full STOP.  But that’s just the problem.  Why would the next generation want to come into an industry that is fully stopped?

But back to the issue of supply management.  What if— supply management ends in the next 5 to 10 years? What if supply management stays?  How will your children continue dairying? Oh! They’re not interested you say.  Well then how will the next generation of dairy farmers get interested in getting into the industry?  We know it’s an awfully expensive entry price.  And, if we keep the status quo, the industry is shrinking from both ends of the marketplace.  Less consumption.  Fewer producers.  What’s the game changer that we MUST find?

Is Everybody Playing Fair?

Canada`s milk supply management is increasingly a hot button issue when it comes to trade negotiations.  Many quote rules of fair trade that exclude supply management never acknowledging that there are hidden subsidies supported by other players in other countries.  Subsidies accounted for only 14% of gross farm receipts (2011) in Canada.  Considerably less than the 19 per cent average of among OECD countries.  This raises the question of what would happen if in the interest of big picture trade negotiations Canadian officials eliminate farm marketing boards and subsidies while other countries were able to keep subsidizing their farmers?  In Japan, South Korea, Norway and Switzerland that means more than half of what farmers earn is from government support.  Yes! Over 50%!!

Are Governments Changing the Playing Field?

Everyone loves to throw the term “level playing field” into the discussion.  But is it really possible?  After all can you name any industry that isn’t subsidized?  And secondly, is a level field really what you want when it involves food production.  After all, without food we die.  That’s more level than I’m looking for!

True Lies

The theory is that if supply management was terminated, larger more efficient farms would readily compete against cheaper imports.  Really?  And who is prepared to deal with how “larger” farms will rile up the anti-large contingent?  But consumer prices will be lower and that makes it all worth it, right? WRONG. The cost comparison between supply management and the market-determined price is like comparing apples and oranges. When the market sets the price, the direct expense to consumers does not generally reflect the outlays incurred by the farmer.  As a result, government must provide billions of dollars worth of subsides annually to farmers if they are to stay in business. The critics of supply management do not factor these hidden taxpayer dollars into the cost of a litre of milk, no matter how critical that support may be to its production.

Is Free Trade Fair Trade?

Economists Jason Clemens and Alana Wilson of the Fraser Institute unfortunately get it wrong in their assessment of Canada’s supply-management system for dairy products in their May 15 column: “Free market for groceries is better for the poor”. Where is their proof that there is suddenly a lower retail price without supply management? A real example is the experience in New Zealand.  They once had supply-management before switching to a free-market situation in the mid-1980s. Surprisingly, to some, prices increased for consumers and a monopoly was established where one dairy controls 90 per cent of the milk farms.  A parliamentary investigation has been undertaken to determine why prices increased. Milk is known there as white gold.

It’s Better for the Consumer

Opponents claim that supply management gouges consumers at least when compared with prices set by “the market”. They talk glowingly about free trade and the positive impact of open markets on industry.  Where do they look when there are market meltdowns, rising unemployment and natural catastrophes? It’s obviously their choice to turn a blind eye to the crutch provided by governments in these “healthy” economies. Even if we could accept the global marketplace who decides the priority markets when drought devastates the food supply of your global partner?  I suspect that the home market would be highest on the list.

Who (or What) is Hiding?

There are certainly a considerable number of issues with the Canadian food system. Surface comparisons would suggest that food is much cheaper in the States.  Closer to reality, is the fact that there are 300 million more people to share the cost of subsidizing the industry. Ron Versteeg of Dairy Farmers of Canada says Canadians have nothing to hide. “We stand alone in providing, clean, consistent and transparent access to our market, while other countries hide behind phony non-tariff barriers.” There is no hidden subsidy provided by Canadian taxpayers to dairy farmers.  Each time consumers buy milk or cheese they contribute to dairy sustainability and resilience, to say nothing of this country’s food security.   By comparison, U.S. Subsides to dairy producers represent about 40 per cent of American dairy farmer incomes, when it reaches them.  These subsidies come directly from taxpayers’ pockets.  At the store, the U.S. consumer pays only a portion of the overall cost of producing milk.  The rest is paid through their taxes. Without that hidden support, American dairy products would be much more costly for consumers, and much more expensive than the equivalent Canadian product.

But You Can’t Get Into the Game!

The quota value for a small forty cow operations is over $1 million. Barrie McKenna, columnist with the Globe and Mail, suggests decline in farms is directly related to barrier of entrance in the industry. Making it impossible for young farmers to finance that in addition to cattle, land, barns and equipment.  Supporters of supply-management argue the high quota shows that the industry is healthy and, like other profitable businesses, dairying require high start-up costs, similar to purchasing franchise fees to begin operations. There are many other non-agricultural businesses that no longer have “mom and pop” operations.  Decreasing economies of scale make it difficult for small businesses to compete; this decline in numbers extends beyond the dairy industry.  Having said that, just because the problem is difficult does not mean that we should give up.

The BULLVINE BOTTOM LINE “Nowhere to Hide!”

You can hide in the bushes and hope that it will all turn out right in the end. But wouldn’t you rather be “It!”  In the past successful builders of the dairy industry did not wait for the dreaded pronouncement “You must be caught!”  Supply management was their solution.  What is ours?

 

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