Farmgate milk price to increase by 2.3255%

Ottawa – Following a review and consultations with stakeholders, the Canadian Dairy Commission announced it will increase the farmgate milk price by 2.3255 per cent on Feb. 1, 2026. This increase translates to just over two cents per litre of milk sold to processors to produce finished dairy products.

In October 2025, the commission conducted the annual review of Canadian farmgate milk prices. As a result of this review and consultations with stakeholders, the changes are intended to be implemented on Feb. 1, 2026.

The National Pricing Formula is a pricing mechanism determined by the industry that considers dairy farmers’ costs of production as well as the consumer price index. The result of the recent changes is an increase of 2.3255 per cent.

The combined effect of the National Pricing Formula and the adjustment to carrying charges will result in an increase in the cost of milk used to make dairy products such as milk, cream, yogurt, cheese and butter for the retail and restaurant sectors of 2.3750 per cent, which translates to just over two cents per litre of milk sold to processors to produce finished dairy products.

While Canada’s inflation rate remained within the target range throughout 2024, producers continued to face upward pressure on costs, the Canadian Dairy Commission said in a news release, adding that the cost of animal feed and labour contributed to sustained cost pressures.

The commission said this increase reflects a balanced approach that aligns with recent inflation, which rose to 2.4 per cent, and food price trends, which rose to four per cent in September. The increase supports dairy producers in managing rising input costs while maintaining affordability and stability for Canadian consumers, the CDC said.

In addition, the CDC’s carrying charges will increase. The CDC collects carrying charges to partially offset the cost of storage programs.

The net impact of these increases on the final cost of dairy products is unknown since prices are also influenced by incremental factors further along the supply chain such as labour, transportation, distribution and packaging costs. A change in price paid to farmers for their milk does not necessarily translate to a similar consumer price change.

The following stakeholders contributed to this year’s milk pricing review process: Dairy Farmers of Canada, Dairy Processors Association of Canada, Canadian Federation of Independent Grocers, Restaurants Canada and Retail Council of Canada.

The new farmgate milk prices will become official once they are approved by provincial authorities later in 2025.