Milk prices up 8.8% in Canada, but inflation isn’t the only cause: Field Agent

A new report reveals just how much the cost of milk has increased across the country.

The latest Fluid Milk Report from Field Agent says the dairy product has reached “record high” prices in Canada, increasing by an average of 8.8% since last year. The increases were the most startling in Mississauga, Ont., where prices surged 15.3%, and the lowest in Quebec City at 3.7%. 

According to Field Agent, some of those figures are attributable to adjusted farm gate pricing increases that went into effect at the start of February. But Jeff Doucette, general manager of Field Agent Canada, says the increases speak to the larger flaws in the overall system in Canada. 

"It is very difficult to not recognize that Canada's milk production is very inefficient when farm prices have increased twice in a little over a year all the while U.S. prices are falling by double digits at the same time,” Doucette said in a press release. ”It appears that it is time that we stop protecting small, inefficient Canadian supply chains and start consolidation within the Canadian milk industry so Canadian families can continue to afford to put milk on the table." 

But Doucette tells Canadian Grocer consumers are unlikely to see changes anytime soon.

“There is probably not a lot of appetite at the provincial level and there won’t be unless consumer groups start making noise,” he says. “The other issue is that the dairy industry is a powerful lobby group and there is likely not a lot of appetite for change if consumers are not pushing back.”

Meanwhile, when comparing prices at Walmart stores stateside, Field Agent discovered the average cost of a gallon of milk had actually decreased by 12% from a year ago. 

And while rising food prices have been much-discussed across Canada for months now, Doucette says inflation isn’t entirely to blame, otherwise U.S. milk prices would have gone up.  

“While inflation is part of the issue, the main issue, from my perspective, is that we need centralisation of production to drive down costs and allow for similar retail prices across Canada like we see with non-regulated products such as Coca-Cola… which has a very tight retail price range if you were to visit a Walmart in Vancouver, Toronto, Montreal and Halifax,” he says. Meanwhile, the price for four litres of milk varies widely across the country, he says.

For the first time, Field Agent also compared pricing on non-dairy milk options, specifically Silk’s Unsweetened Almond milk, the top seller in the category.

The study authors conclude that as dairy milk increases in price, plant-based alternatives are becoming more affordable. 

"Our survey shows that Silk products were just 10% higher than cow's milk on average and in some markets the price of a carton of Silk was actually cheaper than a carton of cow's milk,” Doucette said. "Are Canadians going to make the switch to plant-based alternatives to save money on their grocery bill?"

Some of the other topline findings from Field Agent: 

•Least expensive city to buy milk in Canada: Sudbury, Ont., with an average cost of $1.43/litre on four litre packages; 

•Most expensive city to buy milk in Canada: Charlottetown, P.E.I., with an average cost of $2.16/litre on a four litre package. 

•The least expensive milk was at Costcos in Langford B.C., and Regina, Sask., with four litres of milk costing $5.39 ($1.35/litre)

•The most expensive milk was at 7-Eleven stores in Langford, B.C., Winnipeg and Regina, with two litres selling for $5.99 ($3/litre)