Power to the Powdered Milk: Support Rising
CANADA - Support prices for butter and skim milk powder will rise in Canada on the first of February 2008, the Canadian Dairy Commission announced on Friday.
12 December 2007
2 minute read
The support price for skim milk powder will increase from $5.9212 to $5.9835 per kg, while the support price for butter will increase from $6.8695 to $6.9316 per kg. Support prices are the prices at which the CDC buys and sells butter and skim milk powder to balance seasonal supply-and-demand changes on the domestic market.
This increase is expected to translate to a revenue increase to dairy producers, worth one per cent or 70 cents per hectolitre for the industrial milk used to make products such as yoghurt, cheese, butter and skim milk powder. The overall increase to producers may vary, depending on the pricing decisions made by provincial authorities, the CDC noted in a release.
"Increased productivity at the farm level allows the CDC to announce an increase that is below inflation. Our decision takes into account increases in direct farm costs such as feed, fuel, fertilizers and herbicides" said CDC chair Randy Williamson.
The new support price of butter will also include an increase of two cents per hectolitre in the carrying charges collected by the CDC to pay for the storage of the normal butter stocks.
Meanwhile, the margin received by processors for the skim milk powder and butter purchased by the CDC, and included in the support prices, will increase by 10.7 cents per hectolitre to take into account rising energy costs.
The margin received by processors for the skim milk powder and butter purchased by the Canadian Dairy Commission, and included in the support prices, will increase by 10.7 cents per hectolitre to take into account rising energy costs.
The impact of this increase at the retail level will be influenced by many factors such as manufacturing, transportation, distribution and packaging costs throughout the supply chain.
The Canadian Dairy Commission, a federal Crown corporation created in 1966, is a key facilitator within the Canadian dairy sector. The CDC helps design, implement, and administer policies and programs to address dairy producer and processor needs. It is mandated to provide efficient dairy producers with the opportunity to get a fair return on their labour and investment, and to ensure that Canadian consumers are provided with adequate supplies of quality dairy products.
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