Canadian Dairy Commission
Symbol of the Government of Canada

No Change to Butter and Skim Milk Powder Support Prices

OTTAWA, July 15, 2004  The Canadian Dairy Commission (CDC) announced today that the support prices for butter and skim milk powder will remain unchanged until February 1, 2005

CDC Commissioners reached this decision following consultations with major dairy stakeholders. Careful consideration was given to preliminary cost of production data for 2003 which measures the BSE impact on producer costs, BSE relief funds already committed by the federal government which are in the process of being issued to dairy producers, and the market impact of deviating from the current practice of one price change per year.

CDC Chairman, John Core, made it clear that "the CDC is committed to a significant support price adjustment to be announced in December for implementation on February 1, 2005". This commitment takes into account the ongoing BSE impact, the loss of revenue to producers as a result of the recent WTO decision which limits Canada's ability to export skim milk powder, and CDC's assurance that 50 percent of dairy producers in Canada will recover their cost of production by 2006.

Support prices are the prices at which CDC buys and sells butter and skim milk powder to balance seasonal supply and demand changes on the domestic market. Support prices are also used as references by provincial marketing boards to price milk sold to processors who manufacture dairy products such as butter, skim milk powder, cheese, yogurt and ice cream.

The Canadian Dairy Commission, a federal Crown corporation created in 1966, is a key facilitator within the Canadian dairy sector. The CDC helps to 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 obtain a fair return on their labour and investment, and to ensure that Canadian consumers are provided with adequate supplies of quality dairy products.

                                                                                       - 30 -

For more information, please contact:

Chantal Paul
Communication Services
Canadian Dairy Commission
Ottawa, Ontario, K1A 0Z2
Tel: (613) 792-2040

John Core
Canadian Dairy Commission
Ottawa, Ontario, K1A 0Z2
Tel: (613) 792-2061