Any increase could come into effect on Sept. 1, the Canadian Dairy Commission says
By Diego Flammini
Dairy Farmers of Canada (DFC) is asking the Canadian Dairy Commission (CDC) to increase the farmgate price of milk.
Increases in production costs necessitate a price hike, DFC says.
“In less than a year (Jul. 2021 to Mar. 2022), costs have increased drastically for fertilizer (+44 per cent), fuel (+32 per cent) and animal feed (+8 per cent) just to name a few,” the organization said in a June 2 statement. “The upward pressure on costs is expected to continue.”
Normally, the CDC adjusts dairy pricing once per year.
The CDC acknowledged receiving DFC’s request on May 27.
A consultation period with stakeholders will take place between June 13 and 15.
The groups involved in the consultation include DFC, Dairy Processors Association of Canada, Retail Council of Canada, Consumers Association of Canada, Restaurants Canada and the Canadian Federation of Independent Grocers.
The organizations will look at multiple factors, said Shana Allen, chief of communications and strategic planning with the CDC.
“The Board reviews all the information, including the results of the consultations and economic data, and then renders a decision,” she told Farms.com in an email. “Economic data includes things such as the CPI, inflation, world commodity prices, farm input prices related to cost of production (feed, fuel & oil, fertilizer & herbicides, etc.).
Any change in price won’t be reflected until the fall.
“According to this request, this increase would come into effect on Sept. 1, 2022, and would be deducted from any price increase that may result from the routine price review in the fall of 2022,” the CDC said in a June 2 statement.
If the CDC grants the request, it would be the second price increase this year.
The first came on Feb. 1, when milk prices went up by 8.4 per cent.
It’s unclear how much of a price increase DFC is seeking.
But the process will be out in the open, the organization says.
“Unlike producers of other goods and services, who can adjust their prices behind closed doors, the farmgate price of milk is adjusted in an entirely open and transparent process through the CDC,” DFC’s statement says. “This transparency is one of the many benefits Canadians get from our supply management system.”
Consumers in P.E.I. pay the most for milk in Canada.
Shoppers in Charlottetown are paying an average of $1.96 per litre on a 4L package of 2% milk, data from Field Agent says.
On the other hand, shoppers in Mississauga, Ont. pay the least. They’re paying $1.31 per litre on a 4L package of 2% milk.