The farmers had the milk and the processor wanted new business. Between them, they forged a new business relationship for mutual benefit.
In December 2008, the Manitoba Organic Milk Co-op (MOM), and Notre Dame Creamery launched Organic Meadow, a new line of Manitoba-produced and processed organic milk.
The organic milk sold here had previously come from outside the province.
The business relationship producing it is also the first up-and-running “value chain” to be formally organized in Manitoba with support from Value Chain Manitoba, a federal/provincial-funded initiative being delivered through the Manitoba Rural Adaptation Council.
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Value chain production of organic milk was presented as a win-win approach, the first year of operation appears to confirm that, according to Conrad Zacharias, chair of MOM and a dairy producer at Winkler.
“The main thing is that we’re not in competition with the processor,” says Zacharias, adding that this sort of partnership means farmers can focus on farming, while their partners in the chain do what they do best too.
Organic milk is a new product line for Notre Dame Creamery. They had not previously produced liquid milk products, let alone organic.
The value chain represents a deal struck between not only the milk co-op and Notre Dame Creamery, but Dairy Farmers of Manitoba, and Guelph-based co-operative Organic Meadow Inc.
Zacharias credits Organic Meadow Inc., which markets the milk, for pursuing Value Chain Manitoba to help forge this linkage. It got this project moving, he said.
“We were already trying to do this without the funding,” he said.
Staff with Value Chain Manitoba hope to get more farmers in Manitoba exploring value chains.
The value chain is a relatively new concept in Canadian agriculture, and many question how they differ substantially from supply chains, which tend to position farmers as price-takers.
Value Chain Manitoba co-ordinator Eugene Warwaruk and MAFRI staff member, business development specialist Annette Allen spoke at the Southwest Farm Women’s Network seminar at Ag Days in Brandon last week.
Warwaruk says Value Chain Manitoba’s main job is helping more farmers familiarize with value chains and helping farmers pursue potential chain partners. “We play that role as facilitator.”
The approach interests particularly those farmers who’ve been trying to go it alone in some form of direct marketing venture, he said. They see a value chain as a means towards achieving greater efficiency in production and marketing, said Warwaruk.
Zacharias said participation in one has opened his eyes to many new aspects of milk marketing and processing.
“For the first time in our lives as farmers we’ve sat at the table with the guy that does the packaging and the one that distributes and the guy that figures out if the product should go on the third or fourth shelf (of the grocery store)… it’s been a big education,” he said.
Value Chain Manitoba is hosting a series of video-conferenced seminars to familiarize agro-Manitoba with the value chain concept.
The next will be held January 28 at MAFRI GO offices and will focus on how a producer group can begin to approaches retailers as chain partners.
Value Chain Manitoba is a four-year joint initiative between MAFRI and the MRAC. It is funded until 2011.
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