Jeff Green | Mar 29, 2017
Last Thursday (March 23) Richard Allen from Frontenac County’s Economic Development Department, and Carey Bidtnes from the Kingston Economic Development Corporation (KEDCO) hosted three sessions on the prospects for the goat dairy industry in Eastern Ontario. They were joined by goat experts from the Ontario Ministry of Food and Agriculture, including small ruminant specialist Jillian Craig, and raw milk specialist Philip Wilman.
Richard Allen hosted the sessions, and Carey Bidtnes kicked things off by setting out the context for an unprecedented potential growth of the small but growing goat dairy industry in Ontario. Bidtnes is the point person at KEDCO who is working with officials from the huge Chinese agricultural corporation Feihe. Feihe will commence construction on a $250 million plant in Kingston this summer. The plant will produce high end baby formula using surplus skim milk from Ontario dairy farms, and will directly employ over 200 people, many more during the construction phase. In China, Feihe’s premium brand sells for $75 (Canadian) for a 750 ml can, a one week’s supply.
As Bidtnes explained, the plant will be built with two production lines, a cow milk line that will begin production as soon as the plant is built, and a goat milk line that will begin production in 5-7 years or when there is enough goat milk available to run the line.
The problem for Feihe, and Bidtnes by extension, is that the goat dairy industry in Ontario produces 46 million litres a year, and represents the bulk of national production, which is 55 million litres. Feihe is looking for 75 million litres a year. By comparison, 8,100 million litres of cows milk are produced each year in Canada (accordnig to Stats Can figures from 2015).
There are about 250 goat dairy farms in Ontario, the smallest with as few as 250 milking goats, and there are some with as many as 1,500 goats.
Feihe operates on an entirely different scale. In China they run a vertically integrated company. They grow their own grain, raise and milk animals and turn their own milk into formula. When Bidtnes and Allen visited China in January, they toured a massive indoor Feihe facility which has 10,000 milking cows. In China, Feihe is about to construct 7 goat dairy farms that will each house and milk 70,000 does in a single indoor facility.
“Feihe runs all their own farms in China ever since the Melamine scandal of 2008. They need to feel confident of the quality and cleanliness of their supply. But in Canada, where the dairy industry is second to none, they want to work with independent farmers,” Bidtnes said.
Jillian Craig and Philip Wilman did not talk much about the potential for large dairy goat farms. They presented information based on the current state of the goat dairy industry in Ontario.
“There are two goat milk brokers in Ontario, and I would not recommend anyone invest in dairy goats without first securing a contract with one of them,” Welman said.
As he explained, purchasing good quality dairy goats and building new or retrofitting a barn for goats are expensive propositions. Good quality does cost about $1,000 each but goats breed well, producing 2-3 offspring each year. The market for goat meat as well as goat milk is good in Ontario so male goats can either be sold to a feed lot or raised for later sale.
He also said that the average price for goat milk is about $1.09 per litre.
“While there are some who say goats can produce 3 litres a day, I think 2.5 litres is as good as anyone can expect on average. Does produce from 600 to 1,000 litres per year, and if Welman is to be believed, the number is closer to 600.
He also said that the cost to produce a litre of milk, with all costs included, has been estimated by government officials at $1.30.
A member of the audience asked if he was hearing correctly. “If it costs $1.30 and sells for $1.09, what is the point of it all.” he said.
Welman said that the $1.30 figure is misleading.
“It assumes that farmers don’t do any of their own labour and includes mortgage costs on buildings and other costs. The top five farms that I know produce milk for about 87 cents a litre,” he said.
Jillian Craig said there are two feeding systems that farmers use. Farmers can purchase feed pellets that have all the necessary nutrients in them, or a total mixed ration system using corn and hay that they grow or purchase, along with other nutrients. Most Ontario goat dairies are parts of larger farm operations that grow much of their own feed.
Craig and Welman indicated that proper research and a lot of preparation is necessary before taking the plunge into the goat dairy industry. They did not speak at all about the logistics involved in very large scale goat operations.
To supply Feihe’s plant, the milk from 100,000 to 115,000 dairy goats will be necessary, and breeding will have to be staggered among that herd to provide a constant supply. To put that in a North American perspective, there were approximately 360,000 dairy goats in the entire United States in 2016. A 9,600 goat farm is being constructed in Wisconsin, which will be the largest in the United States. The goat cheese industry takes all the milk US producers can supply and is looking for more.
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