Sep 1, 2006 12:00 PM
IN ONTARIO, Canada, milk can be held in tank trucks overnight, which could provide opportunity for terrorists or vandals to compromise the loads, said John Johnston of the Ontario Milk Transport Association.
Canada requires the trailer to be sealed when the driver is not present, but in practice the sealing occurs at the last farm where the milk is loaded. This means that if a driver leaves the truck temporarily, the load becomes vulnerable, he said.
In addition to food security concerns, the situation can cause major liability to the hauler if the milk is condemned at the processing plant, ending in loss of the load and levying of a disposal cost.
Canadian health and safety inspectors are stepping up food regulation requirements, and the number of inspectors now available has doubled. Fines for non-compliance can be as high as $62,500 Canadian ($55,485 US) for a company and $3,750 ($3,329 US) for individual company executives.
Canadian milk haulers typically are cited for not documenting programs and procedures. “The transporter's bottom line on this issue is more office staff, even for a one- or two-truck transporter, to keep track of all of the record keeping necessary to comply with the safety regulations and to document driver training,” Johnston said. “This is an increase in administration cost at a time when the producers are trying to cut costs.”
In addition, Canadian milk sales are declining. The Ontario Milk Transport Association is encouraging sales of specialty milk that brings higher prices to offset the loss, such as organic, omega 3 (milk enhanced with fatty acids), kosher, and ultra kosher.
“This puts the spotlight on transportation costs,” said Johnston. “Transporters want to maintain their profits and producers want to contain their costs — a perfect combination for conflict.”
All Ontario milk is sold to the Dairy Farmers of Ontario (DFO), a milk marketing board, by farmers and hauled by transport “agents of the board” to designated plants, Johnston said.
At the plant the processor is charged for the raw milk based on the end use. For example, fluid milk costs more than milk used for butter or cheese. Processors pay the DFO for all of the milk they purchase, and once a month the DFO pays the transporters and the producers.
Transporters are paid on a formula based on the number of farms served, the volume picked up, and the distance driven. The calculations include overall average cost across the board for fuel; truck and tank repairs, and maintenance; trucks and tank trailer purchases; depot operations; management; interest on financing; and profit.
Canadian milk haulers are awaiting final hours-of-service regulations that are under development. “A great concern to the transporters is that the drivers have to make a living wage or they will go elsewhere to work,” Johnston said. “The restrictions on the hours of work mean that the rate per hour must increase to provide a living wage. This is next to impossible to achieve.”
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