Grilling Cheese and Milk Costs

Why do Canadian cross-border shoppers stock up on milk, butter, cheese, yogurt, egg’s and other food products? Simply for prices that are “considerably” less than what Canadians pay for the same “essential” food products. A cow is a cow! It eats the same amount of grass in Canada as it does in the US and, since the geographical area of Canada is greater than the United States logic says that we must have more grass in Canada thus eliminating the old “raw materials” cost theory. So why am I paying $1.75 for a gallon of milk in Buffalo and $4.58 for a gallon of milk in Toronto?

Here is the second installment as to why Canadians pay more than our U.S. neighbors for certain foodstuffs. In this Blog we will look at milk and products derived from milk such as cheese and butter. Research is from articles and studies by the Conference board of Canada, Statistics Canada and press articles.

The Canada Government has maintained and supported a “dairy supply management” policy for more than forty-years. In a nutshell, the system limits milk production and keeps dairy imports out in order to provide producers with higher milk prices.

motivatorc9fa6e2b31b596eee6423cf1096b226b1b8edb9c

Ottawa also has rules to keep out cheaper imports that would undercut domestic production and prices. Ottawa limits cheese imports to one-twentieth of Canadians’ cheese consumption the rest is subject to a 246% tariff (see chart). We allow in even less yogurt and other dairy products.

milk tarrifs

High milk “policy prices” come at the expense of all other Canadians. Buyers of dairy products—processors, restaurants, retailers, and consumers—effectively subsidize dairy producers by paying higher prices than they would otherwise. The OECD estimates the subsidy at $175,000 per dairy farm.

According to Stats Canada the Retail Price for 2012 were Cheese $13.77/kg, Butter  $3.88/454kg and Margarine $2.14/454kg

The Conference Board of Canada, November 2009 Report by Danielle Goldfarb “the substantial protection the system affords comes at the expense of the processors and consumers who buy milk and dairy products”

So there you go, you pay a higher price for milk, butter, cheese and other milk products not because the Canadian Retailer is making more money from you but because the government is and says you will.

http://www.conferenceboard.ca/e-library/abstract.aspx?did=3294

About 2sidesof49

This Blog is for all Canadian Cross-Border Shoppers wanting to maximize their returns on their U.S. shopping trips. Visit 2sidesof49.com for tips and tricks and links to our partners websites, blogs and products. Also check out my book The Canadian Cross-Border Shopping Guide - guaranteed to save you money!
This entry was posted in Uncategorized and tagged , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s