Canadian Dairy Commission appoints new CEO, increases farmgate price of milk and butter

CANADA – Canadian Dairy Commission (CDC) has appointed Benoit Basillais, the CDC’s director of policy and economics, to become its new CEO effective 11 July 2022.

Basillais replaces Serge Riendeau, the dairy producer and former Agropur Co-operative president who’s been the CDC’s chief executive since 2018 and had an extended tenure from April 2021 for one additional year.

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The June 30 order from the council to appoint Basillais as CDC’s CEO sets his term at four years before an extension is considered or another appointment is made.

Canadian Government cushions farmers from economic crisis witnessed

 Meanwhile, the Canadian Government through CDC, has decided to increase the farmgate price of milk and butter for the second time in 2022 in response to a request to cushion farmers from inflation.

The decision follows an earlier request by Dairy Farmers of Canada for the commission to review the farmgate prices due to the current inflation witnessed in the country.

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In making its decision, the CDC said it considered the possible impacts of a price increase on consumers and demand, and decided that the farmgate milk price will be increased by $1.92/hl, effective Sept. 1, 2022.

The Commission added that it has also decided to increase the support price for butter also for the second time to make nutritious dairy products affordable for Canadian families.

The increase in the support price for butter is from $9.79 per kg to $10.02 per kg and will be effective at the same time.

CDC detailed that the adjustments will increase by 2.5% on average the price for milk used in the manufacture of dairy products such as milk, cream, yogurt, cheese, and butter intended for the retail sector and the food service industry.

This increase will be reflected in the milk class prices according to a ratio of 60% on butterfat and 40% on other milk components.

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The net impact on consumers will also be influenced by factors such as transportation, distribution, and packaging costs throughout the supply chain.

The commission emphasized that the price paid to farmers is governed by part of the price paid by consumers.

The increase in producers’ revenues will partially offset increased production costs due to inflation that has left the prices of feed, energy, and fertilizer to increase by 22%, 55%, and 45% respectively since August 2021.

According to CDC, the next fall, during the regular price review of the Sept. 1 adjustments will be deducted from any adjustment for Feb. 1, 2023.

The Canadian dairy administrator revealed dairy farmer revenue has improved in recent months, partly due to last February’s price increase and partly due to the rise in world prices, which affects a significant part of the milk that farmers sell on the domestic market.

The Commission pointed out that in the last five years, the consumer price index for dairy increased by 7.7% compared to 14% for meat, 21% for eggs, and 32% for fish.

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