Are Canada's milk prices fair to consumers?
Did you know when you buy a bottle of Coke in Canada you pay nearly the same price no matter where you go? Not milk. Although it’s considered a basic necessity, a recent price survey shows consumers across the country are not treated equally.
From the farm, to the processing plant, to the store, it’s always been important to maintain the supply.
“The tariffs are so massive,” U.S. President Donald Trump complained. In early June he tweeted about Canada's tariffs on American dairy products. Canada has put in a place a tariff system to limit cheaper American dairy products from glutting the market to help protect Canadian dairy farmers and to maintain a consistent Canadian supply of milk.
Subsequently President Trump made Canada’s milk supply management system a battleground for a trade war with Canada. He doesn’t think the system is fair to Americans. But did you know Canada’s milk quota system may not be fair to Canadian consumers either?
That’s no bull. Keeping those cows churning out a continuous supply of milk in every province has been the foundation of the milk management system but it comes with a price.
Based on a four-litre jug of 2 per cent milk, a recent price survey of 171 stores in 18 cities across the country shows huge price differences.
The price in St. John’s, Nfld. was $1.85 a litre, but in Sudbury, Ont. the average was $1.07 a litre – 42 percent less. In Burnaby and Coquitlam the average price was $1.19 a litre. In Kelowna it's $1.23 a litre.
“Oh, no way,” said one North Vancouver shopper.
“Oh really, I wonder why?” said Heidi as she was picking up her milk.
“At the crux of everything is the fragmented quota system in Canada,” explained Jeff Doucette with Field Agent Canada.
Field Agent is a mystery shopping survey app that utilizes 90,000 smartphone users across the country to conduct price audits and shopper surveys from coast to coast.
In B.C. farmers pool their milk with the four Western provinces which help keep prices in line with the national average milk price of $1.22 a litre but still milk prices are not as cheap as Ontario.
Doucette says a national dairy pool would make prices easier to swallow for consumers.
Doucette says bringing down provincial barrierswould create national competition to help drive prices down.
“If it’s a base milk product it should be relatively comparable from one market to the next across Canada. A national milk pool, beyond leveling the playing field for consumers in different provinces across Canada, would actually make us more competitive with the U.S. market,” he pointed out.
Costco stores in Ontairo had the cheapest prices for milk at $1.06 a litre but even so American milk prices south of the border near Buffalo, New York were nearly half that price.
The Canadian Dairy Commission told CTV News the idea of a national pool has been talked about but getting all the players on board is difficult. And dairy pricing involves more than just the price paid to the farmer.
There are processers and various retailers who get involved and everyone adds in their profit margin.
While consumers we talked to would like a lower price they are still willing to pay more for locally produced milk.
“More important is quality,” said one shopper.
“Buying local and buying organic is better for my children,” said Heidi as she picked up her milk and headed to the check-out counter.
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