‘Unprecedented’ milk, dairy prices set to soar in 2022

Get ready to pay significantly more for milk and other dairy products in 2022. Plus, a mobile checkout app could signal the eventual end of cashiers. Richard Southern reports.

By Mike Visser and Richard Southern

You can add milk and dairy products to the long list of grocery items Canadians will be paying more for in the new year.

The Canadian Dairy Commission quietly posted a statement on its website on Friday, recommending an increase of 8.4 per cent in the price dairy farmers receive for their milk.

Sylvain Charlebois, who runs the Agrifood Analytics Lab at Dalhousie University, says that will likely translate into a price increase of about eight to 10 per cent for milk on grocery store shelves. But an even more significant price increase is on the way for manufactured dairy products.

“As far as dairy products are concerned, the increases may exceed 15 per cent because there’s a multiplier there,” Charlebois told CityNews. “For cheese, for example, you need eight to 10 litres of milk to produce one kilo of cheese.”

In a statement to CityNews, a spokesperson for the Canadian Dairy Commission claims the increase compensates farmers for significant increases in the costs of fuel, equipment, and cattle feed.

“The cost of producing milk has increased by 13.4 per cent in the last two years, which is a large increase. Animal feed, for example, increased by 27 per cent and fuel by 30 per cent,” the spokesperson said. “In the last couple of years, farmers’ revenues have not increased as rapidly, and a significant adjustment is needed to give farmers a chance to continue to supply milk and dairy products to Canadians.”

Charlebois calls the increase “unprecedented,” pointing to the previous record initiated by the Canadian Dairy Commission, with was a 4.52 per cent increase in 2017.

“Typically, you would see one, two, perhaps three per cent. They’re recommending an increase of 8.4 per cent. That’s almost double the previous record.”

The looming increase in dairy products is bad news for restaurant owners who are already reeling from the impact of COVID-19 restrictions.

“Restaurants Canada is furious today because they’re seeing their bottom being hard hit by this recommendation, especially pizzerias, places where they use a lot of cheese,” said Charlebois.

The Canadian Dairy Commission is a crown corporation, and Charlebois wants to see more transparency from the organization moving forward.

“Most Canadians are clueless about the dairy sector because the dairy sector wants it that way. For the betterment of the dairy sector, I think it would be important for the CDC to provide more information to Canadians because it is owned by Canadians.”

The recommended price increase still needs to be rubber-stamped by provincial authorities later this year. If approved, the hike would take effect on February 1, 2022.

According to the Canadian Dairy Commission statistics, the consumer price index for dairy products has increased by 7.4 per cent over the past five years. Eggs have gone up by 20.6 per cent over that same period, while meat products have seen an 11.8 per cent bump, along with 7.7 per cent for fish.

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