The Canadian Dairy Commission will raise its farm gate milk price by 2.3255 per cent in February, the Crown corporation announced on Friday.

This followed the annual review of prices and consultations with stakeholders. The increase takes effect on Feb. 1, 2026.

Despite lower inflation in 2025, producers have faced higher animal feed and labour costs, the commission said. The increase “reflects a balanced approach” that aligns with inflation and food price trends.

The commission will also raise its carrying charges to $0.0254 cents per kg of butter from $0.0137 per kg, effective Feb. 1.

The commission collects carrying charges to offset the cost of its storage programs. The Canadian Dairy Commission balances seasonal changes in the supply and demand of butter by buying butter and holding it back while milk production is high and demand is low, and then selling it back to manufacturers when demand increases and production drops, according to Wednesday news release.

The combined effect of the price increases will cause the cost of milk to food processors to rise by 2.3750 per cent, or roughly two cents per litre.

In 2025, the dairy commission slightly reduced its farm gate milk price on productivity gains and lower costs for some inputs.

Source: Farmtario / Geralyn Wichers