The cheapest city in the country to buy milk was Ottawa with an average cost of $1.09/L on four-litre packages of 2%. In Charlottetown, the most expensive city in the country to buy milk, the average cost is $1.83/L.
“We have seen decreases in the retail price of milk in some markets since the first edition of the Canadian Fluid Milk Report in 2015, but the disparity between the cheapest milk and most expensive milk in Canada is staggering,” said Jeff Doucette, general manager of Field Agent Canada, in a release introducing the report.
Field Agent Canada conducted its price survey at 174 retailers in 20 markets across the country between May 22 and 29.
•Cheapest milk in Canada goes to Costco in Ontario where four litres of 2% sold for $4.29, or $1.07/L •The most expensive was 7-Eleven stores in Ontario where just two litres of 2% cost $4.99, more than twice the Costco price at $2.5/L.
Field agent also looked at milk prices at Walmart stores in five border communities in the U.S. •Best cross-border deal goes to Amherst, New York where Field Agent found milk going for $0.66 per litre.
According to Doucette, the drastically different prices for milk are proof that Canada’s dairy production system is not efficient and needs updated for the 21st century. Now is the time to restart that conversation with the Federal election coming up and the introduction of Canada’s first Food Policy, he said.
The inefficiencies arise from Canada’s famous “Supply Management,” which controls the amount of milk produced through provincially set quotas, Doucette told Canadian Grocer. “Because milk does not flow across provincial boundaries each small market in Atlantic Canada has a small, relatively inefficient dairy herd compared to bigger provinces such as Ontario.” That means less competition and higher costs in smaller markets, he said.
The price of milk across the country is very similar to the price of Coca-Cola or Pepsi, he said. ”Soft drink producers can build large and efficient bottling plants in central locations that drive their cost per unit down,” he said. “If these manufacturers were forced to have a bottling plant in each of the four Atlantic provinces by a ‘Soft Drink Board’ set up by the provinces the price of soft drinks would also likely have a wider price gap from city to city.” That said, Doucette does not expect the system to change any time soon.
“The challenge is the dairy lobby is very strong (as indicated by the high price of milk in Quebec despite being a large market) and the political will to make a change is likely lacking,” he said.