Canadian processing milk prices will increase by 1.5 percent next year, the Canadian Dairy Commission announced Dec. 2.
Based on higher feed and fuel costs, it said the CDC support price for skim milk powder and butter will increase effective Feb. 1.
Table milk prices are not bound by the industrial milk price increase because they are set by provincial boards, but they tend to track the CDC decisions.
The CDC also made the point that the increase was less than dairy’s 2.2 percent cost of production over the past year and half the food inflation rate.
Dairy Farmers of Canada said the CDC, a government agency, was merely reflecting cost increases that are beyond farmer control “and the current economic climate.”
The Canadian Restaurant and Foodservices Association, on the other hand, said the increase will keep Canadian dairy prices among the highest in the world and will continue to hurt restaurants that face higher costs for their cheese products such as pizza.
It said by world-price standards, Canadians continue to pay $2.4 billion more than they should for dairy products.
Next year’s hike will make it worse and the system of CDC price setting must be opened up to more scrutiny, said the restaurant lobby that is one of the most vocal critics of supply management.
“It’s time we built a dairy system in Canada that is fair and transparent for farmers, processors, restaurateurs and consumers,” CRFA vice-president Justin Taylor said in an association statement on the increase.
He complained that dairy price setting is done behind closed doors.
The CRFA has launched a web campaign against the price of dairy products through freeyourmilk.ca.
