News
CRFA: Hike means more overpayment for dairy

Dec. 4, 2008, TORONTO – Consumers and restaurant owners will continue to be grossly overcharged for Canadian dairy products with the decision yesterday by the Canadian Dairy Commission to increase the price of industrial milk on Feb. 1, 2009. Industrial milk is used to make products such as cheese, yogurt and ice cream.

“Dairy is pricing itself off the menu of Canadian restaurants,” says CRFA vice president Ron Reaman. “Today’s decision sends a clear message to restaurant owners that the dairy industry is not interested in working with us to grow demand for their products.

“Given the unjustified, year-over-year increases in the price of industrial milk, as well as the bleak economic outlook, we expected a price decrease. We want to work with the dairy industry, but [this] decision leaves restaurant owners with little choice but to further rationalize their use of cheese and other dairy products.”

The latest numbers from the CDC show that the cost to produce industrial milk fell by 2.3 per cent in 2007, but the price went up by 1.06 per cent last February and by another 2 per cent in September. Consumers continue to be overcharged. The price will go up by another 1 per cent next year.

To make matters worse, new regulations around compositional standards for cheese that take effect Dec. 14 will further drive up prices and force consumers and restaurant operators to seek out dairy alternatives.

In the last 14 years, the price of industrial milk has skyrocketed 57 per cent, or nearly twice the rate of inflation, while the cost to produce the milk has risen by a mere 6 per cent.