Expansion could curdle without massive quota injection

Glengarry-Prescott-Russell MPP Jean-Marc Lalonde announced the cooperative would receive a $1.3 million contribution towards a $9 million expansion and modernization project scheduled for completion in 2012.

When the project is completed, the St. Albert factory – already doing $30 million a year in sales - will be closing in on the “big boys” in terms of efficiency and capacity.

However, the project – which includes major retailing inroads into the Toronto market – could be held back if St. Albert can’t get sufficient milk quota, manager Réjean Ouimet explained.

Ouimet said the factory will require 4-5 million litres of additional quota to add to 22 million litres already in place. Industrial quota is purchased through the Dairy Farmers of Ontario marketing board as it becomes available.

That only happens when other processors go under or fail to use their full quota allotment. Ouimet is hoping St. Albert will secure its increased milk requirement through closure of small processing plants across the province which haven’t been able to keep up with increasingly stringent environmental regulations.

“We’ve spoken to half a dozen and indicated our interest. It’s tragic for them but good news for us because we’re in expansion mode. You have to move forward to stay in this business.”

Several weeks ago, St. Albert bought out 8,500 litres of quota from Forfar Dairy which closed its cheese making facility in the Rideau Lakes; but that’s only a drop in the bucket vis-à-vis the total need.

The EODF will award $80 million over four years to attract business development and new investment, as well as create jobs. For the purposes of the fund, Eastern Ontario comprises 13 counties and the rural portion of the City of Ottawa.

The St. Albert project will add 10 new jobs to the 75 full-time positions already in place at the factory in a region where every job counts, Ouimet observed.

It was only right that the first grant to be delivered under the EODF should go to St. Albert – founded in 1894 – with its proven job creation and re-investment record, Lalonde said.

“Smaller businesses like St. Albert Cheese add value to the region’s economic competitiveness and diversity,” he told a small audience on hand at the cheese factory.

The manager said he had no qualms about embarking on a major project during tough economic times: “Such conditions present opportunities.”