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Milk production in Canada is controlled by a quota system. Any farmer who wishes to produce milk must have a quota. The quota fixes and controls prices. This is known as price fixing but with friendlier name.

Dairy organizations that collect the hefty fees for not producing anything other than bureaucracy and millions of dollars of commercials and advertising claim that the system helps “Canadians pay fair retail prices” according to Bill Mitchell, spokesperson for the Dairy Farmers of Ontario reports the Globe and Mail.  

This hardly seems fair considering the OECD estimates dairy prices in Canada are more than double world market prices.

It would appear price fixing, which any first-year economist student would tell you is a recipe for disaster, gouging and, lining the various daily organization's pockets with consumers hard-earned cash is considered fair by the Dairy Farmers of Ontario.

More shocking is that the Dairy Boards force dairy farmers to flush millions of litres of milk down the drain if the farmer improves efficiency and produces more than is dictated by the 40-year-old quota system. After all, if that fresh milk were to hit the market, consumers might pay a reasonable price, and fewer kids could go hungry.

The system restricts imports by imposing strong tariffs on some dairy products. That is unless for example, you are a Canadian company making frozen pizzas that have to compete with US imports. In this case, the company can buy cheese at the US price, but your local pizza shop will be forced to pay the artificially inflated retail prices which in turn you will end up paying.

We did some research to compare what prices are in North America.

Cost of 4 liters of milk ~ 1 gallon

$8.29 Loblaws on Rideau St., Ottawa, Ontario, Canada

$4.66 Ontario, Canada

$5.29 Walmart, Toronto, Canada

$7.49 Nova Scotia, Canada

$2.29 Walmart, Buffalo, NY, USA

$2.10 Bellingham, Washington, USA

$1.59 Arizona, USA

$1.96 Detroit, MI, USA

$1.69 Madison, Wisconsin, USA

Fair indeed. Canadians are funding some of the most expensive milk in the world out of their own pockets and mouths of their children.

By definition, setting prices through a “marketing board” results in unfair prices. That is why most cartels are illegal. They prevent a free market and therefore distort prices via price fixing.

The Dairy Board(s) should change its name to the Dairy Cartel to prevent the possibility of being accused of false marketing.  

To paraphrase the dairy board(s) mantra, “Bend over please, we’ll be fair about milking you dry. It does a body good!”

Updates:

National Post article on Canada's price fixing dairy board cartel

Canada's Dairy Board drives thousands into poverty

Colby Cosh - Canada's Dairy Cartel

Canadians milked by dairy quotas - Toronto Sun

Andrew Coyne: Milking Trump for our own benefit

Dairy Lobby steals 2017 Conservative leadership?

"Canada’s dairy quota system has been Canada’s shame since it was introduced in 1970. The quota system makes milk prohibitively expensive for poor families, it denies Canadian consumers the right to purchase diverse cheeses from around the world and it destroyed Canada’s once-great cheese industry, whose many small producers capitalized on milk surpluses to make world-famous cheddars — Ontario alone once supplied England with half of its cheddar cheese imports." National Post

Canadian families are milked hundreds of dollars each, every year.

Comments

sean
GTA, Ontario, Canada
 9 months ago

Fear mongering nonsense


Newmarket, Canada
 over 5 years ago

Ontarians pay the same as what Hawaiians pay for 1 gallon of milk ($4.30). Just think milk produced in the continental USA and shipped thousands of miles to Hawaii.


Londonderry, United States
 over 5 years ago

Nothing beats US milk loaded with hormones, antibiotics, yummy.

Fear mongering nonsense

sean
GTA, Ontario, Canada
 9 months ago

Montreal, Canada
 over 5 years ago

I do not eat meat, so my main source of protein are milk products.I now have to pay 3.99 for the 750 ml of yogurt I used to pay 1.99 just a year ago. More over, most of the companies surreptitiously decreased the amount of yoghourt in their containers from 750ml(which originally used to be a 1L) to 650ml, simultaneously increasing the prices. Cottage and cheese have become practically unaffordable. Canadian milk product prices are growing even faster than the price of gasoline (which, in turn, is famous for being shamelessly doctored (fixed). I don't know who is to blame, the middle men or the producers, but somebody is definitely having fun with our money and laughing all the way to the bank. This has to be stopped! This mafia-like approach to money-making on the backs of the voiceless and docile population is unacceptable. Lets fight them all together,in any way possible, otherwise, we are nothing but a bunch of slaves whose hard earned dollar loses 50 to 70% of its value when we buy their milk and serves only to the enrichment of these crooks.

Taylor J
Rural Canada
 over 5 years ago

What a bunch of PROPAGANDA by the country's restaurants and grocery chains. For the $2.99 you pay for a glass of milk at restaurant, farmers get $0.20. compared to the restaurants +$1.00 profit. See who is REALLY gouging you!

Shaun
Ontario
 over 6 years ago

It's crazy that you put this up today. I was just writing a blog post on how I "vote with my dollars" and travel to the US for all my milk.

Tank of Gas, Trunk of Milk

sean
Islamorada, United States
 almost 7 years ago

Organic milk in Homestead, FL - $3.75/gallon.

nick
toronto
 almost 7 years ago

Farmers in Ontario see 70% of retail? Who actually said this? and where did you get your facts? Ontario farmers get 10 cents on a four litre bag you see in the store. I know... a family friend has a dairy farm.

John
Toronto/Florida
 almost 7 years ago

We're buying organic RBSt free milk, cream cheese and sour cream in Florida for about 1/3 the price in Canada. We were surprised to find that the products are much higher quality than in Canada. The Dairy Board must be watering down their sour cream

Tina

 about 7 years ago

As an Ontaro Dairy Producer,our 65 cows give us a daily income of about $600. We use that to feed 100 animals and 3 families. American Dairy producers use RBSt to help make there cows make more! Ask an American Dairy producer about his income!

Miriam
Fort Erie
 about 7 years ago

I buy my milk across the border in the US for half the price. That comment shows how out of touch with reality the dairy board is. Just another example of screwing the consumer to milk us dry. I can't believe they have the gall to call it fair to us.

Mark
Ontario
 about 7 years ago

Manure is right, the comment below must be from somebody in the Canadian Dairy Cartel. Comparing a different hemisphere to Canada!? A fair comparison would be between Canada and the US. Price fixing is wrong and screws us consumers every time.


Grand Bend, Canada
 about 7 years ago

What a load of manure. Farmers around the world suffer from multinationals paying farmers much less for their milk.New Zealander's retails milk price is $5.29/4L &dairy farmers get about 30% of that. Farmers in Ontario get a fair share@70% of retail.

 

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