DAIRY FARMERS OF ONTARIO PLANT SUPPLY QUOTA POLICY

Transcription

1 DAIRY FARMERS OF ONTARIO PLANT SUPPLY QUOTA POLICY AUGUST 2006

2 DAIRY FARMERS OF ONTARIO PLANT SUPPY QUOTA POLICY AUGUST 2006 TABLE OF CONTENTS Intent... 2 Objectives... 2 Part One Plants Manufacturing Classes 2, 3, 4 and 5 Products 1. Definitions General Conditions Plant Supply Quotas (All Plants) Supply Quota Allotments (All Plants) Utilization of Quota Milk Plant Supply Quota Transfers Plants Closing for Part of a Quota Supply Period Adjustment of Plant Supply Quotas at End of Quota Supply Period Picket Lines, Strike Action, Lock-outs and Emergency Shutdowns at Industrial Milk Plants Skim-Off Cream at Plants with Supply Quotas Milk and Cream Transfers to Quota Plants Christmas through New Year's Milk Deliveries Skim Milk Resulting from the Manufacture of Aerosol Whips Domestic Dairy Product Innovation Program Part Two Ice Cream Plant Milk Entitlement Quota 1. Definitions in this Part Application Purpose Milk Entitlement Quota (MEQ) Over-Utilization of Milk Entitlement Quota Under-Utilization of Milk Entitlement Quota Milk Equivalent/Butterfat Equivalent Calculation Conditions for Transfer Skim Milk... 13

3 - 2 - Intent The intent of the Plant Supply Quota Policy is to provide a set of procedures, established by Dairy Farmers of Ontario in consultation with the Ontario Dairy Council and other processors, for the marketing of the available milk supplies to the industrial milk processing facilities in the province. Objectives The Plant Supply Quota Policy should contain procedures that: are market-responsive such that milk can be delivered to those classes of milk that have the potential to increase consumer demand or have demonstrated increased demand; are flexible so that processors have the ability to adapt their milk supplies to changing market conditions; allocate milk supplies such that reasonable returns to producers and processors are maintained or enhanced; allocate the respective entitlements of the available industrial milk to all Plant Supply Quota holders in an equitable and fair manner; and can be administered effectively by Dairy Farmers of Ontario and are clearly stated and explained so as to be easily understood. 1. Definitions (e) Part One Plants Manufacturing Classes 2, 3, 4 and 5 Products "Quota supply region means a geographic area defined by Dairy Farmers of Ontario. "Quota-exempt milk" means the milk marketed as industrial milk for use in Classes 1 and 2 (excluding evaporated skim milk and condensed milks) as defined in O. Reg. 753 of this policy. Plant supply quota (PSQ) means the amount of milk, in litres, allotted to a plant which represents the plant's share of the milk available to industrial milk plants for Classes 2**, 3, 4 and 5 utilization within the quota supply region. Cheese quota means the amount of milk, in litres, allotted to a plant which represents the plant s share of the milk available to industrial milk plants for Classes 3 and and 5 and * utilization within the quota supply region. Non-cheese quota means the amount of milk, in litres, allotted to a plant which represents the plant s share of the milk available to industrial milk plants for Classes 4, (a1),,, (m)*, 5,, and * utilization within the quota supply region. * Milk utilized in these Classes requires a CDC permit. Class 5 includes cheese for planned exports ** Class 2 evaporated skim and condensed milk

4 - 3 - (f) (g) (h) (i) (j) (k) (l) (m) (n) (o) "Quota milk" means milk marketed to plants with plant supply quotas for utilization in the manufacture of Classes 2**, 3, 4 and 5 products. Quota milk is to be determined based on volumes recorded on Dairy Farmers of Ontario's Milk Collection Reports. "Quota product" means a product manufactured using quota milk. "Quota supply period" means the period of time for which quotas are allotted. "Ice cream" or "dairy blend" means a combination of milk, cream and other milk products that may or may not be custom-blended and may be sweetened with sugar, liquid sugar, invert sugar, honey, corn syrup or any combination of such sweeteners or other sweeteners and may contain flavourings, food colour, ph adjusting agents, stabilizers, emulsifiers and salt. "Plant" means a licenced premise where milk is received for the purpose of being processed. "Processor" means a person or a corporation operating one or more milk processing plants and engaged in the processing of milk products or fluid milk products. "Quota plant" means a plant in respect of which Dairy Farmers of Ontario has allotted a plant supply quota. On-demand refers to that volume of milk received on a quota-exempt basis to manufacture dairy products in Classes 1 and 2 (excluding evaporated and condensed milk), cottage cheese in Class 3 and any similar products which would be classified as Class 5 utilization. PSQ milk refers to that volume of within-quota milk, on a daily basis, that remains after fulfilling the on-demand domestic requirements of fluid and industrial processors. Note that this milk may be allocated in accordance with the rules as determined by the P5 All-milk Pool. Surplus milk refers to the volume of milk, in litres, that is produced in excess of 100 per cent of a province s (Ontario) all-milk production quota, less any portion of the over-quota production that is deemed appropriate by the Canadian Milk Supply Management Committee (CMSMC) that is not subject to provincial accountability. 2. General Conditions Dairy Farmers of Ontario may adjust the supply quota(s) of a plant by a percentage applicable to all supply quotas depending upon the milk supplies projected to be available for quota milk utilization. The plant supply quota policy shall be applicable to industrial milk plants located in the regional municipalities and the counties of Ontario, subject to the provision of section 2(h). ** Class 2 evaporated skim and condensed milk

5 - 4 - (e) (f) (g) (h) (i) (k) All plant supply quotas that are allotted by Dairy Farmers of Ontario to industrial milk plants shall be the property of Dairy Farmers of Ontario and shall be allotted to licenced industrial milk plants for their use. There shall be one quota supply region designated in Ontario subject to the provisions of section 2(h). Plants not licenced, by the Food Inspection Branch, to process milk shall not be allotted supply quotas. A processor who contravenes Dairy Farmers of Ontario's Plant Supply Quota Policy may have all or part of its plant supply quota, for a quota supply period, cancelled by Dairy Farmers of Ontario. This policy is subject to amendment at any time on 45 days notice to all holders of plant supply quotas. On August 1, 1994, Ontario moved from four marketing pools to one pool. PSQ was established for the one industrial plant that was operating in Northern Ontario. This policy does not apply to the volume of milk surplus to the fluid market in the former Kenora/Rainy River and Thunder Bay pools. Upon completion of a Domestic Dairy Product Innovation Program (DDPIP) Contract, the plant possessing the contract shall be issued a volume of plant supply quota equivalent to the volume utilized under the contract, during the last year of the contract, or the average of the last two years, whichever is greater. A processor, who defaults on payment for milk purchased from Dairy Farmers of Ontario in contravention of the applicable Dairy Farmers of Ontario Pricing Regulation, may have all or part of its PSQ cancelled or reduced by Dairy Farmers of Ontario. Dairy Farmers of Ontario will endeavor to allot a like amount of PSQ to other processors and to apply any proceeds received by it to cover its costs and losses due to the milk payment in default. Following the decision of the World Trade Organization (WTO) in December 2002, regarding Canada s allowable subsidized export levels and the establishment of over-quota production accountability at the provincial level, as established by the Canadian Milk Supply Management Committee (CMSMC), all milk produced above a threshold established by the CMSMC will be considered to be surplus milk. Any such surplus milk may be allocated on a quota-free basis for the purpose of building butter stocks, supplying food banks, disposal, and/or the manufacture of products destined for export within Canada s allowable subsidized export levels, i.e. through the issuance of a permit for utilization in Classes 4(m), 5 or any other designation as permitted by the Canadian Dairy Commission. Note: Information pertaining to Dairy Farmers of Ontario s intent to allocate surplus milk for the reasons outlined above will be conveyed to the Ontario Dairy Council.

6 Plant Supply Quotas (All Plants) (e) (f) (g) (h) (i) The supply quota allocation shall be for the quota supply period, August to July inclusive, which shall, in turn, be sub-divided into two quota supply periods, namely, August to January inclusive and February to July inclusive. The allotment of quota shall be determined by projecting the milk volume available for supply quotas during the quota supply period. Dairy Farmers of Ontario shall supply a milk plant with sufficient volume of quota-exempt milk to meet its requirements for utilization in Classes 1 and 2. (subject to the provisions of Part Two: "Ice Cream Plant Milk Entitlement Quota"). Dairy Farmers of Ontario may adjust the plant supply quota(s) of an industrial milk plant by a percentage applicable to all plant supply quotas of the same type to set total quotas equal to the volume of milk expected to be available to quota plants. Quota milk shall be delivered to the purchasing plants on the days it becomes available during the month. With the exception of temporary breakdowns or in cases of emergency, an industrial quota plant, which refuses to accept its milk entitlement based on the average provincial supply percentage, shall have its current plant supply quota reduced by the lesser of: (i) (ii) the litres of milk that were refused; or the litres of milk by which their monthly quota receipts fall below their monthly entitlement, based on the average provincial supply percentage. Each month Dairy Farmers of Ontario shall inform quota plants of the average percentage that total quota milk utilization is of the total quota of those plants sharing the quota milk supply. Where a processor has more than one industrial milk plant, such plants may be considered jointly, rather than separately, for purposes of comparing the plants' quota milk utilization with the provincial average utilization, and providing no additional transportation costs are incurred by Dairy Farmers of Ontario as a result. An industrial milk plant, which accepts milk that has been rejected by another plant, shall receive that volume of rejected milk on a quota-exempt basis. 4. Supply Quota Allotments (All Plants) A plant's supply quota shall be divided into two separate plant supply quotas. These two quotas shall be known as cheese quota (Classes 3,, 5, * utilization) and non-cheese quota (Classes 2**, 4, (a1),,, (m)* and Classes 5, and * utilization). * Milk utilized in these Classes requires a CDC permit. Class 5 includes cheese for planned exports ** Class 2 evaporated skim and condensed milk

7 - 6 - (i) The basis for establishing PSQs effective August 1, 2003, was the volume of cheese and non-cheese quota issued for the 2001/2002 supply period and adjusted by 3.7 per cent and 0.6 per cent respectively (AC Neilson data presented to the Canadian Milk Supply Management Committee in July 2002 for consumption trends in the previous twelve-month period). (ii) (iii) Once the AC Neilson data was applied to the 2001/2002 PSQs, the total volume of plant supply quota issued for the 2003/2004 supply period was set at a level equal to 891,200,000 litres, the same volume of PSQ in place for the 2002/2003 supply period. Following the issuing of plant supply quotas for the 2003/2004 supply period, no further adjustments will be made to the volume of quota allotted to industrial quota plants, unless mutually agreed to by the Ontario Dairy Council and Dairy Farmers of Ontario. A plant's annual allotment of cheese quota shall be allotted on the basis of 50 per cent during the six-month period, August 1 to January 31 and 50 per cent during the six-month period, February 1 to July 31. A plant s annual allotment of non-cheese quota shall be allotted on the basis of 50 per cent during the six-month period, August 1 to January 31 and 50 per cent during the six-month period, February 1 to July Utilization of Quota Milk (e) (f) A plant may use its supply quota in the manufacture of any products included under Classes 2**, 3,, 4, (a1),,, (m)* and 5,,, and *. A processor who is unable to make use of his/her quota entitlement and as a result refuses to accept milk for utilization in Classes 2, 3, 4 and 5, shall have his/her quota reduced for that quota supply period by the volume refused. This is subject to the provision in sub-section of this section. Dairy Farmers of Ontario will endeavor to allocate a plant's quota milk supplies on a month-to-month basis relative to the plant's needs from month to month, depending upon the supplies available. A plant shall lose no part of its plant supply quota if it closes temporarily during the low-production months of October through February and plants are encouraged to do so, upon receiving the prior approval of Dairy Farmers of Ontario, subject to the provisions of section 12. Effective August 1, 2003, all milk supplied to quota plants for use in Class 5, above a base setting volume, will be allocated on demand. For the purpose of this section, the base setting volume will be that volume of milk utilized by a quota plant in Class 5 during the 2001/2002 supply period. Subject to section 9, a plant whose quota milk entitlement constitutes less than 15 per cent of its plant throughput and whose quota milk utilization in a quotasupply period exceeds 110 per cent of its quota milk entitlement for that quota supply period, shall be required to pay the equivalent of the Class 3 price plus * Milk utilized in these Classes requires a CDC permit. Class 5 includes cheese for planned exports ** Class 2 evaporated skim and condensed milk

8 - 7 - $10.00 per hectolitre for all such milk over its entitlement, the difference in price being payment for the privilege of exceeding its quota milk entitlement by more than 10 per cent. Such additional charges shall be invoiced to the applicable processors at the end of each six-month quota supply period and shall be paid by the processor to Dairy Farmers of Ontario no later than the twenty-first day of the following month. This policy provision shall not apply to multi-plant processors and shall only be permitted and implemented by Dairy Farmers of Ontario at its sole discretion after consultation with the Ontario Dairy Council. 6. Plant Supply Quota Transfers Unless stated otherwise, any reference in this Policy to plant supply quota transfers pertains to both permanent and temporary transfers alike. (e) (f) (g) (h) A plant supply quota shall be transferable, in whole or in part, between and among industrial milk plants subject to the terms and conditions of this policy and to the approval of Dairy Farmers of Ontario. A request for a transfer of plant supply quota shall be made, in writing, and submitted to Dairy Farmers of Ontario at least 30 days prior to the effective date and shall state the duration of the requested transfer, in months, and the reasons for the requested transfer. A transfer of a plant supply quota shall become effective only on the first day of a month. Dairy Farmers of Ontario may approve the transfer of a plant supply quota on a temporary basis for a period of no less than one month or more than twelve months. Except in cases of catastrophe, a processor will be permitted to make no more than two temporary transfers of plant supply quota within any supply allocation period, i.e. August to July. Note: On-going requests for the temporary transfer of plant supply quota, e.g. the third and/or fourth requests within two dairy years, must include a detailed background on the need for such transfers. No third party shall benefit financially in any way from the transfer of plant supply quota from one plant to another. If such is found to be the case subsequent to the transfer, Dairy Farmers of Ontario may declare the transfer null and void or take such other action as Dairy Farmers of Ontario considers appropriate. The transfer of cheese quota shall be approved only on the condition that the quota milk will be utilized to manufacture cheese products by the plant to which the supply quota was transferred, subject to the provisions in section 5. Non-cheese plant supply quota may be transferred, with the approval of Dairy Farmers of Ontario, to another plant for use in the manufacture of products in any of the Classes 2, 3, 4, and 5.

9 Plants Closing for Part of a Quota Supply Period This section shall apply to all quota plants. A plant which normally closes during the winter months, is subject to the following provisions: (i) (ii) Such a plant may close on its usual closing date. It will be supplied its apportionment of plant supply quota by its closing date, with the exception of the amount of quota milk required for the remainder of the quota supply period after re-opening in the spring. Any plant supply quota not required by the plant may be transferred under the terms of this policy, subject to the provisions under section 6. A plant, which previously closed during the winter months and now wishes to remain open should, at the beginning of a quota supply period, arrange with Dairy Farmers of Ontario to supply its present plant supply quota over the quota supply period, or may obtain, by transfer, additional plant supply quota to remain in production during the period the plant was usually closed. A plant wishing to close temporarily for any reason will: (i) (ii) request Dairy Farmers of Ontario to redirect its milk supplies, giving Dairy Farmers of Ontario 30 days notice of its intent in writing. Any additional transportation cost incurred as a result of such redirection shall be assessed to the plant making the request to redirect its milk supplies. have the milk directed from the plant by Dairy Farmers of Ontario during the temporary closed period, deducted from the plant's supply quota for that quota supply period only, except for plant closures during October to February, inclusive, where Dairy Farmers of Ontario may waive such quota penalty, subject to the provisions under section 12. Dairy Farmers of Ontario shall consider requests from plants that wish to cease production for periods of time other than those stated in this section. Each request shall be considered on its own merit and implications such as additional transportation costs, time of the year, level of residual milk supply, etc., will be included in the evaluation. 8. Adjustment of Plant Supply Quotas at End of Quota Supply Period This section shall apply to all quota plants. Subject to the provisions of section 5, the litres of quota milk which a plant receives in a quota supply period, below that to which it is entitled by receiving the average percentage of supply quota in that period, shall be added to its plant supply quota for the next quota supply period. This adjustment shall take place after the establishment of the plant supply quotas for the next quota supply period.

10 - 9 - Subject to the provisions of section 5, the litres of quota milk which a plant receives in a quota supply period, above that to which it is entitled by receiving the average percentage of supply quota in that period, shall be deducted from its plant supply quota for the next quota supply period. 9. Picket Lines, Strike Action, Lock-outs and Emergency Shutdowns at Industrial Milk Plants Where deliveries of milk are prevented from reaching a plant by picket line, strike action, lock-out or emergency shutdown, arising within the plant organization, such milk shall be diverted from the plant by being redirected to another processor by Dairy Farmers of Ontario and the amount of milk redirected shall be deducted from any plant supply quota of the processor for that quota supply period and any additional transportation charges resulting therefrom shall be the responsibility of the processor. With the approval in writing from Dairy Farmers of Ontario, on application therefrom, such a processor may remove such milk from the plant and direct it to the plant or plants designated by Dairy Farmers of Ontario in its approval with the actual expenses of such diversions being the responsibility of the processor. Where deliveries of milk are prevented from reaching a plant by picket line, strike action or lock-out caused by elements outside the plant organization, the amount of milk diverted from the plant by Dairy Farmers of Ontario shall not be deducted from the plant supply quota of the plant for that quota supply period. An industrial milk plant, which receives milk diverted by Dairy Farmers of Ontario from a plant which is unable to receive milk because of picket line, strike action, lock-out or emergency shutdown, shall have its plant supply quota for that quota supply period increased by the amount of milk it receives from the plant from which the milk is diverted as a result of the strike action or lock-out. Dairy Farmers of Ontario may approve the temporary transfer of plant supply quota where an industrial milk plant undergoes an emergency shutdown. Where a temporary quota transfer is approved by Dairy Farmers of Ontario, milk directed from the plant shall not be deducted from the plant's supply quota. The application for the emergency transfer shall state the cause of the emergency and the period of time required. Unprocessed milk held within the storage facilities of the plant undergoing the emergency shutdown, if supplied to another quota plant, shall be on a quota-free basis. Additional transportation costs shall be the responsibility of the industrial milk plant undergoing the emergency shutdown. Equipment breakdowns, power interruptions, fires and emergency installation of equipment shall be considered as emergencies.

11 Skim-Off Cream at Plants with Supply Quotas This section applies to all quota plants. Cream that is skim-off as a result of cheese manufacturing and which is utilized in the manufacture of a quota product shall be declared as such by the original purchaser of the milk irrespective of whether the original purchaser utilized the skim-off cream as such or whether the original purchaser sold the skim-off cream to another processor for manufacture into a quota product. If the original purchaser of the milk is the holder of a supply quota, the volume of skim-off cream used in the manufacture of a quota product, either by the original purchaser or a secondary purchaser, shall be charged against the supply quota of the original purchaser of the milk. 11. Milk and Cream Transfers to Quota Plants A plant with a supply quota purchasing (or acquiring by interplant transfer) milk, partially-skimmed milk, skim milk or cream for use in a quota product from a fluid milk plant (or an industrial milk plant that has not been allotted a plant supply quota) that has surplus milk or both surplus cream and surplus partially-skimmed milk and/or skim milk, shall have such purchased product included as quota milk. 12. Christmas through New Year's Milk Deliveries For the milk supply period December 23 to January 3, Dairy Farmers of Ontario will calculate an average per cent entitlement based on the available residual milk. Plants that do not receive their average daily entitlement during this period or do not receive milk on December 24, 25, 26, 31 and January 1, 2, and 3 will have their PSQ utilization for this period increased to eliminate any under-supply that develops relative to the daily entitlement. Plants that receive milk on December 24, 25, 26, 31 and January 1, 2, 3 inclusive and end up being over-supplied during the December 23 to January 3 period, will have their PSQ utilization for this period decreased to eliminate any over-supply that develops relative to the daily entitlement. 13. Skim Milk Resulting from the Manufacture of Aerosol Whips Skim milk resulting from the manufacture of aerosol whips (pressurized creams) shall be considered as quota-exempt. 14. Domestic Dairy Product Innovation Program A quota plant that has received approval under the Domestic Dairy Product Innovation Program to manufacture a new quota product, shall have its plant supply quota allotment adjusted each month by the volume of milk used in that month in making the said new product, on notification from the processor, subject at all times to the terms and conditions of the contract under the Domestic Dairy Product Innovation Program.

12 Definitions in this Part Part Two Ice Cream Plant Milk Entitlement Quota (e) (f) (g) "Single-purpose ice cream plant, means a plant that, during the immediately preceding calendar year, produced frozen dairy products exclusively and "ice cream plant" shall mean a "single-purpose ice cream plant". "Frozen dairy products" means ice cream, ice cream mix, ice milk, ice milk mix, frozen yogurt, yogurt ice cream, yogurt ice milk, sherbet and sherbet mix. "Quota supply period" means the dairy year for which the milk entitlement quota is fixed and allotted. Dairy year means August 1 to July 31 inclusive. Domestic market refers to the milk supplies which single-purpose ice cream plants are entitled to under the provisions of the National and P6 pooling agreements. Milk entitlement quota (MEQ) means the amount of milk in litres allotted to a single-purpose ice cream plant by Dairy Farmers of Ontario for the purpose of manufacturing frozen dairy products for the domestic market. MEQ entitlement means a milk entitlement quota adjusted by Dairy Farmers of Ontario to reflect 70 per cent of the plant s actual domestic butterfat requirements. 2. Application This part applies to single-purpose ice cream plants including any such plants that do not purchase raw milk from Dairy Farmers of Ontario. Part One of the Plant Supply Quota Policy does not apply to single-purpose ice cream plants. 3. Purpose A single-purpose ice cream plant shall be limited to sourcing no more than 70 per cent of its butterfat requirements from whole milk. 4. Milk Entitlement Quota (MEQ) A milk entitlement quota (MEQ) shall be determined for the quota supply period and shall, in turn, be sub-divided into two quota supply periods, namely, August to January inclusive and February to July inclusive. An ice cream plant s milk entitlement quota (MEQ) shall be equal to 70 per cent of the milk equivalent of the butterfat originating in Canada and used by that plant in the manufacture of the frozen dairy products for the domestic market during that month.

13 The amount of milk delivered by Dairy Farmers of Ontario to a plant, in any one month, shall equal that plant s previous month s utilization. Variations in monthly demand, other than historical seasonal variations, of plus or minus 5 per cent, are to be reported to Dairy Farmers of Ontario in writing ten days prior to the first day of each month. Notification is required to allow Dairy Farmers of Ontario staff sufficient time to re-direct milk supplies and factor changes into PSQ estimates. An ice cream plant s utilization records may be subject to an audit review by industry auditors on a quarterly basis. Industry auditors are appointed jointly by Dairy Farmers of Ontario and the Ontario Dairy Council. 5. Over-Utilization of Milk Entitlement Quota Ice cream plants which over-utilize their MEQ entitlement as a result of utilizing more than 70 per cent of the milk equivalent of their total butterfat (Canadian) requirements from whole milk within a six-month supply period, will be subject to a price increase on the butterfat equivalent of all milk processed in excess of its MEQ in accordance with the Pricing Regulation in effect. It will be applied to the applicable ice cream plant or their transferee at the end of each six-month quota supply period and shall be paid by that ice cream plant to Dairy Farmers of Ontario no later than the twenty-first day of the next month following the quota supply period. A processor with MEQ is expected to source its skim-off butterfat requirements from within its own organization or from another processor with surplus butterfat. A processor with MEQ, which has no source of skim-off cream, may request to be supplied whole milk on an as-needed basis, when market conditions are such that skim-off cream cannot be sourced. In addition to the price adjustment outlined in section 5, any milk supplied in accordance with section 5 which exceeds the processor s MEQ, will result in: (i) (ii) an assessment being charged against the plant supply quota of the plant utilizing the solids-not-fat. This charge will be based on 40 per cent of the whole milk received, or if the processor does not possess plant supply quota, MEQ deliveries in a subsequent period will be reduced by a volume equivalent to 40 per cent of the excess volume received. 6. Under-Utilization of Milk Entitlement Quota Ice cream plants which under-utilize their annual MEQ entitlement as a result of their utilization of skim-off cream originating in Canada, will receive a price reduction on the butterfat equivalent of any unused MEQ in accordance with the Pricing Regulation in effect. Ice cream plants which under-utilize their monthly MEQ entitlement may carry forward their under-utilization to a subsequent month and/or subsequent sixmonth supply period, within a dairy year (August to July). Net under-utilization as of July 31 will not be transferred to a subsequent dairy year.

14 Milk Equivalent/Butterfat Equivalent Calculation For the purposes of this part, milk equivalents and kilograms of butterfat shall be calculated using the average provincial butterfat test of raw milk for the twelve-month period ending May Conditions for Transfer A milk entitlement quota, fixed and allotted by Dairy Farmers of Ontario in respect of a single-purpose ice cream plant is transferable where, upon application, Dairy Farmers of Ontario is satisfied that: (i) the transfer is incidental to or part of a corporate re-organization, restructuring or between related corporations, or (ii) the applicant has not purchased raw milk from Dairy Farmers of Ontario during the current quota supply period and the proposed transferee is an industrial milk processor which agrees: (i) to be bound by this part as if it were a single-purpose ice cream plant, and, (ii) to ship back to the applicant an equivalent amount of butterfat in the form of cream or ice cream mix during each quota supply period. (i) an application from a new applicant ice cream plant for transfer of a milk entitlement quota must be made prior to July 1st in a year to be effective for the next dairy year. (ii) 9. Skim Milk a request from an ice cream plant for a transfer of its milk entitlement quota from one processor to another shall be made in writing, and submitted to Dairy Farmers of Ontario, at least 30 days prior to the proposed effective date and such transfers shall become effective only on the first day of a month. Skim milk derived from an ice cream plant's milk entitlement quota shall be quotaexempt, regardless of its utilization. Notwithstanding skim milk or partially-skimmed milk purchased (or acquired by interplant transfer), by a plant with a plant supply quota from a fluid milk plant (or an industrial milk plant that has not been allotted a plant supply quota), that sells or transfers cream or ice cream mix to an ice cream plant, shall have such skim milk or partially-skimmed milk included as quota milk.