The organic premium in BC was established over 20 years ago when the market was originally developed in the province. The market currently makes up 4.5% of the overall sales in the province and predominantly markets class 1 products.
Consistent feedback received from organic producers over the past few years had indicated that the premium was not sufficient and a subtle migration of farms converting from organic to conventional production had started.
The Milk Board initiated a consultation to review the Organic Cost of production and the capacity for the market to absorb organic price increases. Serecon was hired to provide two specific reports. In phase 1 of the consultation, the results of an Organic Premium Report which provided a cost of production study. The second part of the consultation reviewed an analysis on the market and its ability to absorb an organic price increase; both reports were reviewed by the Milk Board and SPAC.
On October 6, 2021, the SPAC conducted its final review of the reports and encouraged the Board to make its decision based on the COP report findings. In addition to the SPAC review, the Board offered individual meetings with all organic processors during the week of October 18, 2021 to facilitate individual feedback.
On October 27, 2021, the Milk Board increased the organic premium by $0.03/litre on fluid milk and $0.015 on industrial milk in British Columbia. The phase 1 COP report was the basis of the Milk Boards decision. The table below provides changes that will be effective February 1, 2022.
| Organic Milk Premium $/L | ||
| Fluid Premium | Industrial Premium | |
| Current | $0.30 | $0.15 |
| February 1, 2022 | $0.33 | $0.165 |
| $ change | $0.03 | $0.015 |
| % change | 10% | 10% |
If you have any questions regarding this notice, please contact Woody Siemens at wsiemens@bcmilk.com