The Commission in a statement blamed inflation. “Producers face increases in feed costs, fertilizer costs, fuel costs and interest rates,” it said. The wholesale price of milk and butter paid to dairy quota holders will rise 2.2% in February.
Statistics Canada yesterday calculated overall year over year food inflation has averaged 11% every month since last August. Checkout prices for dairy products last year were 6% more for block cheese to an average $6.61 per 500 grams, 11% more for milk to an average $2.81 per litre, 11% more for cream to $4.20 per litre and 22% more for butter to $5.50 per 454 grams.
MPs have cited the retail cost of milk as a hardship for young families. “There are literally moms out there who are watering down milk,” Conservative MP Philip Lawrence (Northumberland-Peterborough South, ON) told the House of Commons last October 27.
Dairy farmers testifying at Commons finance committee hearings denied profiteering. “Three of the major production inputs – feed, fertilizer and fuel – experienced price increases of 100%, 60% and 50% respectively which is much higher than the Consumer Price Index,” Martin Caron, president of Québec’s Union des Producteurs Agricoles, told a September 28 hearing.
“Remember that the price of agricultural products is only a fraction of the price of food we find on grocery store shelves,” said Caron, a dairy farmer from Louiseville, QC “For example, for every dollar we spend in Quebec on beef, less than 38 cents goes back to the producer. For yogurt only 13 cents of every dollar consumers spend goes back to dairy farmers.”
Grocers have also denied engaging in profiteering. “Many people believe retailers are deliberately profiting from inflation,” Pierre St-Laurent, CEO of Empire Company Ltd. that operates the Sobeys chain, told the House of Commons agriculture committee December 5. “I can’t speak for the other retailers but I can assure you this is completely false in the case of Empire.”
St-Laurent said federally-regulated milk price increases were justified. “The Canadian Dairy Commission seems to have been exposed to all the arguments necessary for a price increase,” he said. “Three consecutive increases have been allowed for reasons I consider to be justified.”
