A disagreement between Dairy Farmers of Canada (DFC) and Dairy Farmers of Ontario (DFO) over promotions and marketing has led the provincial group to withdraw its promotional funding from the national organization.
DFO notified its members this week that it will not be sending funds for promotions and marketing to DFC as of January 1, 2018.
“Dairy Farmers of Ontario wants to make sure its marketing funds are targeted specifically to growth that can be measurable,” Graham Lloyd, DFO’s incoming general manager (as of August 1), told RealAgriculture.
The letter sent to Ontario producers says the provincial and national organizations have been negotiating a memorandum of understanding (MOU) on promotions and marketing since 2014, and that DFO gave DFC an ultimatum on June 2 — either an MOU would be signed, or no more Ontario funding for the national group’s promotions.
“The overarching purpose of the MOU is to obtain better reporting, accountability, and transparency as to how DFC utilizes the promotion funds it receives from DFO,” says the notice, which is signed by DFO chair Ralph Dietrich.
There’s obviously something in DFO’s version of the MOU that the national board, made up of representatives from dairy producer groups across the country, is not willing to sign. A DFC spokesperson said they were unable to comment at this time.
DFC spent over $70 million on marketing in 2015. It’s not clear what percentage of DFC’s promotional spending in past years has come from Ontario, but given Ontario’s status as one of the top two dairy producing provinces, it’s likely a significant amount.
Lloyd stresses the Ontario group views the marketing issue as independent from the work DFC does in the area of policy and lobbying, which is significant given the U.S. has its sights set on Canadian dairy in the upcoming NAFTA negotiations.
Dietrich writes “it is very important to confirm and reiterate DFO’s commitment to DFC as it pertains to it being the national voice for policy and lobby efforts. This decision affects DFC promotion activities only and DFO firmly believes we need a strong national voice to work on our behalf at the national level, and in particular on issues such as trade and proAction.”
The notice to Ontario producers was sent out approximately two weeks before DFC’s annual general meeting, which is coming up July 18 and 19 in Edmonton (where decisions will be made on budgets for 2018, including promotional spending.)
While this disagreement over promotional funding unfolds and NAFTA negotiations loom, DFC is also undergoing changes in leadership. Former executive director Caroline Emond resigned as of July 4th and a new president will be elected at the upcoming AGM, as Wally Smith has served his maximum three terms.