by SUSAN MANN
Canada’s restaurant association is once again requesting the Canadian Dairy Commission lower dairy prices to a more competitive level, while Dairy Farmers of Canada didn’t offer any recommendations on pricing.
The two groups, along with other stakeholders, met separately with the commission last week as part of consultations it holds in advance of setting annual support prices for butter and skim milk powder. The Commission usually announces the prices in mid December and changes are effective the following Feb. 1. Provincial milk marketing boards use the support prices as a reference to establish prices for industrial milk, used to make cheese, butter, ice cream and yogurt.
The Canadian Restaurant and Foodservices Association has made the same request for more competitively-price dairy products for the past several years. It’s again asking for the industry to introduce a special class of cheese pricing for the restaurant industry that, it says, is similar to what other sectors have. In a Nov. 20 letter to the Commission, association president and CEO Garth Whyte says introducing a new class of cheese pricing will level the playing field that forces fresh pizza makers to pay 30 per cent more for mozzarella cheese than frozen pizza manufacturers.
Dairy Farmers of Canada told the Commission farmers have seen increased feed costs this past year says spokesperson Therese Beaulieu, “but we left it at that.”
Whyte says the association has wanted special class cheese pricing for fresh pizza makers for a long time “because we see more market share diminish and we see more and more frozen pizza” eat into the fresh pizza market.
During the past five years, overall restaurant orders have increased by six per cent but pizza orders have decreased “by a stark 12 per cent,” Whyte says in the letter.
The association told the Commission its members want to sell more dairy products, he says. “Help us do that. That was our pitch.”
Whyte says this time around their request to the Commission was specifically for the special class pricing for fresh pizza cheese and to modernize supply management “not destroy it. We’re saying ‘work with us. We want to work with you.’”
In his letter, Whyte also notes dairy farmers are now more efficient than they were in the past yet those efficiencies aren’t being passed on to consumers. This year the cost of production fell by 0.17 per cent, which “further justifies lowering dairy prices for Canadian consumers.”
Commission spokesperson Chantal Paul says the special classes are part of the dairy industry’s special milk class permit program. Decisions about the program are made by an industry committee called the Canadian Milk Supply Management Committee (CMSMC). It’s made up of representatives from all the provincial milk boards and governments. The Commission manages the operations of the program on behalf of industry and chairs the CMSMC.
“But we really can’t make that decision to create a class just for the restaurant people,” she explains. “It has to go to the CMSMC.”
The Commission says on its website the special milk class permit program sets the price of milk according to its end use to allow processors and further processors to remain competitive.
The CMSMC turned down the restaurant association’s request for special class pricing for fresh cheese for restaurants in 1999. The association took matter to federal court in November that year and requested a judicial review of the CMSMC decision. But the court ruled in February 2001 it didn’t have jurisdiction to review a CMSMC decision because the committee is not a federal board, commission or other tribunal as defined in the Federal Court Act.
Beaulieu says the dairy industry hasn’t had any discussions recently on special class pricing for cheese for the restaurant industry.
Canada’s restaurant industry buys $2.5 billion a year of Canadian dairy products, Whyte says in his letter. BF
Comments
"overall restaurant orders increased by 6 percent, but pizza orders decreased by a stark 12 percent". Any other normal business would see this as a very big concern. Not the dairy industry though, we've got the "cadillac" of government legislation models. Eventually, even the cadillac's end up at the scrap yard. Raube Beuerman, Dublin, ON
We have a story that relates directly to SM that all the anti crowd can comment on rather than twisting every other story around worse than a pretzel to make anti SM fit for their cause and abuse .
Joe Vermunt
Fresh pizza makers have been making this case for years, yet just like fundamentalist preachers who wilfully ingore anything to do with evolution, dairy farmers still keep claiming supply management "works" - it never did, and it never will. What is it about the truth that dairy farmers just can't accept?
Stephen Thompson, Clinton ON
There are more people buying the frozen pizza because it is cheaper and more convenient to just toss in the oven at home and when the you hear the "ding" it is done . Also I think you have to realize that more persons are watching their dollars more closely . A $5.00 on sale frozen pizza is cheaper than going out to buy a $17.00 pizza that I ordered for take out locally last Saturday . Plus I had to spend money on gas to go and get it . You have to realize that the economy is not what it was a few years ago . People are watching thier spending more closely .
Even a cadillac comes back as part of a cheaper more fuel efficient new car .
Joe Vermunt
My darling daughter worked for years in a local pizza store, and for a while, just before she left for University, managed a pizza store in a local resort town. Believe me, the first thing any pizza store manager learns is that profit is all about the cheese, and little, if anything, else. Fresh pizza makers have to use domestic cheese, while frozen pizza makers are allowed to use cheaper, imported, cheese, period. Fresh pizza makers, just like non-supply managed farmers who compete with supply managed farmers, operate with one hand tied behind ther back - they wouldn't mind competing with frozen pizza if frozen pizza makers had to use domestic cheese, but they don't, and it sucks - why don't Canadian dairy farmers, and the farm organizations which pander to them, understand any double standard, including the ones they generate?
Stephen Thompson, Clinton ON
Stephen Why is it that fresh pizza makers have to use domestic cheese ?
Maybe one solution would be to have a it shown on the front of every frozen pizza box that they are made with imported cheese .
Joe Vermunt
If my understanding is correct, a number of years ago the frozen pizza industry (can we say McCain?) successfully lobbied government to be allowed to use cheaper imported cheese on their product. Dairy farmers weren't happy (when are they?), but the deal was done.
As for labelling, it may be impossible to do anything because, again if I understand it correctly, as long as a certain percentage of the product is Canadian, it can be labelled as being all-Canadian.
Stephen Thompson, Clinton ON
the type of consumer who is buying frozen cardboard pizza's couldn't care less where the cheese came from, all that they care about is that its's cheap and easy to prepare.
Sean McGivern
PFO
Let's not forget that fresh pizza makers are still paying 30% more than they need to pay for mozzarella cheese, arguably the most expensive single ingredient in any pizza, for no other reason than to pamper Canadian dairy farmers. Let's also not forget that it's fairly-obvious nobody on the Board of Directors of either the CFFO, or the DFO, owns a fresh pizza store.
Stephen Thompson, Clinton ON
People probably should be watching their spending more closely, but I am not convinced that they are, and since this story states that "restaurant orders increased by six percent", it tends to show that they are not. We all know that food in a grocery store is cheaper than in a restaurant for the obvious reasons, but we also know that domestic pizza makers must use domestic cheese protected by a 245% tariff, where frozen pizzas makers are allowed to use less expensive imported cheese. As far as the cadillac coming back as a more fuel efficient car, that is correct, so why are consumers and non sm farmers forced to deal with this unefficient forty year old government legislation. Also, when it comes to government legislation, it is my understanding that the Canadian Competition Act was introduced in 1986. This act was introduced to promote 4 key areas 1.promote the efficiency and adaptability of the Canadian economy 2.expand opportunities for Canadian participation in world markets while at the same time recognizing the role of foreign competition in Canada. 3. ensure that small and medium enterprises have an equitable opportunity to participate in the Canadian economy. 4. provide consumers with competitive prices and product choices. I could argue that sm affects every one of these 4 areas negatively, in one way or another, so as far as I am concerned, when the government introduces legislation for the betterment of all society in general, it should immediatley override legislation of the past, such as sm that is contradictory to the competition act and somehow(surprise, surprise) was granted an exemption. On a closing note, can you imagine how much less of a financial impact there would be, if they had done away with sm then, compared to now. Raube Beuerman, Dublin, ON
There he goes again,everyone always wants there inputs for less.They compare to the U.S. If you want that BST injected stuff go ahead.What is it about you the real truth and your arguments always one-sided,what a joke
John Van Dyk
It's all about consumer choice - there's no reason why Candian dairy farmers shouldn't be able to go to a pizza place and buy pizza made with domestic cheese if they wished to do so. However, how dare you have the unmitigated gall, and arrogance, to tell consumers they shouldn't have the choice to buy whatever cheese they want. Oh, I forgot, they already do - they can buy frozen pizza made with US cheese, or they can buy fresh pizza made with Canadian cheese, which speaks volumes about why consumption of fresh pizza is dropping. If Canadian dairy farmers weren't so blind with greed, they'd agree to let fresh pizza outlets use whatever cheese they wished, and then let them price the pizza accordingly - pizza made with imported cheese would cost so much, while pizza made with domestic cheese would cost proportionately that much more, and all it would take is another container of cheese on the shelf, and one extra button on the cash register. What is is about letting consumers have a choice which so-completely terrifies supply managed farmers? The "real truth" about supply management is that to make it "work", consumers must always be economic slaves to dairy and poultry farmers, and it's a truth dairy and poultry farmers simply can't admit.
Stephen Thompson, Clinton ON
It is up to CDC to figure this out not farmers on the backroads. Your comment is nothing but intimidation
John Van Dyk
I don't know how you can try to defend something that is so wrong in every way imaginable. Even other supply managed farmers know its a system that represents bad public policy and bad economic policy. Unlike you, they tend to keep their dirty laundry private. Raube Beuerman, Dublin, ON
Sorry the tactic of trying to divide dairy farmers will not work
John Van Dyk
We make our pizza at home with the cheese bought in the store and like it better than any pizza in a pizza place or frozen one. Get with it make your own and have a better tasting pizza than you can ever buy fresh or frozen. So why should anyone get the cheese cheaper then what I pay for in the store.
If you could save 30% by using, for example, imported Kraft mozzarella on your home-made pizza, instead of using domestic Kraft mozzarella, would you be able, in a blind-taste-test, to taste the difference? What would you buy with this incremental 30% saving? I seem to recall this sort of thing back-fired on DFO a number of years ago when consumers not only couldn't tell the difference between Canadian ice cream and US ice cream, they tended to prefer the US product.
Stephen Thompson, Clinton ON
Stephen you keep going on about savings . I don't believe that you believe for a minute that the savings will be 30% . You are just throwing smoke bombs on the savings . Look at all the price drops that happened when the Province got ride of the pst .
In late 2010, DFO came right out and admitted that Ontario consumers were paying almost 38% more for milk than US consumers, and that the farm gate price of milk in Ontario was within pennies per liter of the US retail price. Why don't you ask DFO why, after boasting for 40 years about the cross-border retail price equivalency of milk, this retail price equivalency just doesn't matter any more? Furthermore, since DFO kept claiming it was a good thing, it would be just as good if we were to get it back, as it was when we had it in the first place. DFO, the dairy industry, and supply management itself, are all trying to forget what they spent 40 years boasting about, and which could, for the benefit of consumers, easily happen again if dairy and poultry farmers weren't so greedy.
Stephen Thompson, Clinton ON
You are missing the point that the farmer does not get all of the money and that retail can and will rape and pillage every chance they get . There are so many more things cheaper in the US than here . It is getting old how you twist every story on here to supply management being the problem .
Your Needle Is Skipping and people are tuning you out !!!
If cross-border retail price equivalency was meaningless, DFO wouldn't have spent 40 years boasting about it, and producing study after study after study claiming to prove it. Furthermore, nobody tunes out the significance of DFO's admission in late 2010 that the farm gate price of milk in Ontario was within pennies per liter of the US retail price, meaning that the "raping and pillaging" is being done, in Canada, by dairy farmers, not retailers. I mean, really, when the farm gate price of milk in Ontario is within pennies per liter of the US retail price, how can supply management not be the problem? The only people being "tuned out" are Canadian dairy farmers who simply can't accept the truth, and deny it at every turn.
Stephen Thompson, Clinton ON
So just what is the price of milk here . Don't give me some disputable % crap .
What is the price in a large retail chain store for 4L of 2% milk .
If you want to know the price "here", walk into a store and look. If you want to see the US retail price difference, in 2010, google "Canadians don't know the price of milk-the globe and mail". According to the conference board of Canada, Canadians pay an estimated 60 cents more per liter, according to DFO, Canadians pay $4.66 per 4L retail, and the US retail price is $3.38, per 4L. One other thing in that story, that is quite interesting, is the conference board of Canada claims that the price difference between US cheese used for frozen pizzas made in Canada vs the domestic price fresh pizza makers must use is about double. Raube Beuerman, Dublin, ON
Why would I walk into a store and look at the price for some thing I don't buy don't drink and don't produce when we have know it snitty people on here that can answer every thing ?
Since you are on a roll .... what is the price of cheese that fresh pizza makers pay for cheese in the US ? You must agree that comparing the price for fresh and frozen is not an apples to apples comparison .
Further I thought I was asking Stephen since I replied to a posting he made . So the question is now ... Will the real Stephen Thompson please stand up ?
I don't know why any maker of frozen pizza would buy frozen cheese, thaw it, make pizzas, and then freeze it again. Therefore it is only logical that frozen pizza makers in Canada would use exactly the same fresh US cheese used by both frozen and fresh pizza makers in the US, and therefore, the price of this fresh US cheese would be exactly the same for them all. Furthermore, the price US fresh pizza makers pay for cheese is irrelevant because it is exactly the same price paid by US frozen pizza makers. What is it about the Canadian pizza cheese pricing hypocrisy being everything to do with supply management that Canadian dairy farmers just can't understand?
Stephen Thompson, Clinton ON
It is simply amazing the extent to which 15,000 quota-owning farmers will go to justify their continued ability to "rape and pillage" not just the 90% of farmers who aren't in supply management, but also over 30 million Canadian consumers. For example when, if I recall correctly, people in Lambton County can, and do, travel to US retail stores in Port Huron to buy turkeys grown, processed, and packaged in Lambton County, and can buy them for substantially-less money than what they'd have to pay (as my former mother-in-law found out) at the farm's retail store in Lambton County, the "raping and pillaging" of Canadian consumers is being done entirely by supply management, and not at all by retailers. Also, for example, the 30% price differential between the imported cheese used by frozen pizza makers, and the domestic cheese used by fresh pizza makers, not only has nothing to do with retail pricing, but has everything to do with supply management's ability to "rape and pillage" one sector of the pizza industry. Come on, really, supply managed farmers, what is it about supply management being a complete-evil that you just can't understand, and/or accept?
Stephen Thompson, Clinton ON
Its all what your taste preference is. We don,t like the US yogurt compare to Canada,s . When we are in the states we find the price is the same or more down there as up here unless on sale.
The one thing that is not represented in the percentages from Whyte is was it a matter of price that steered people away from ordering pizza or was it a change in eating habits and or more choice on the menu ?
Joe Vermunt
Heard on the radio last week that obesity is on the rise. I am not a dietitian, but I don't think I am wrong to suggest that pizza is at the upper end of the calorie scale, so we can scratch eating habits as being the culprit of lower sales. It doesn't matter anyway, it is not about taste, menu choices or eating habits. Alot of you are missing the point of the story which is that Mr. Whyte wants more competitive pricing to the tune of 30% from the Canadian dairy commission, and DFC, so that he can compete on a level playing field with frozen pizza sales. Raube Beuerman, Dublin, ON
Before I get attacked, let me correct. Mr. Whyte did not ask for a 30% reduction in price, but he would like more competitive pricing because of the 30% price difference in cheese. Raube Beuerman, Dublin, ON
Truth is some on here will not be satisfied with what ever is done to appease the fresh pizza xcheese price until supply management is gone . Even if that was to happen it still won't be a level playing field because we are not the US OF A and we have different regulations here and many other stark differences .
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