Business and Operations
Cheaper cheese update
By Garth Whyte
By Garth Whyte
Earlier this year, the restaurant industry received some great news from the Canadian Dairy Commission (CDC).
Earlier this year, the restaurant industry received some great news from the Canadian Dairy Commission (CDC). The price of mozzarella cheese used on fresh pizza would be going down. This announcement broke a long history of cheese prices going up year after year. It also helped level the playing field with frozen pizza manufacturers, who have enjoyed deep discounts on mozzarella cheese for many years.
At the Canadian Restaurant and Foodservices Association (CRFA), we recognize that more needs to be done to make dairy prices more competitive. However, this new discount on mozzarella cheese for fresh pizza, known as class 3(d) cheese, is a good first step. The price that approved restaurants pay should drop by five to 10 per cent, depending on the mozzarella composition.
We worked closely with the CDC to make this discount happen, and we’re working equally hard to make sure the program is a success – for our members, for consumers and for the Canadian dairy industry, which stands to benefit from a growing demand created by more competitive pricing.
The 3(d) program took effect on June 1 as a 15-month trial program. It’s critical that as many restaurants as possible sign up to make it a success. So far, the CDC has issued more than 4,000-3(d) cheese permits to restaurant owners. It’s an impressive number, but we know there are many more with pizza on the menu.
If you don’t yet have a 3(d) permit, your first step is to visit the CDC website (www.milkingredients.ca) to complete the online application. You will need:
- HST number
- business number
- quantity of mozzarella cheese purchased in the last 12 months
- percentage of mozzarella cheese purchased that is used to make pizza prepared and cooked on site
If you’re a CRFA member, we can help you through the application process, as well as help you troubleshoot with the CDC if for some reason your application is turned down. If you’re not a CRFA member, consider joining us to take advantage of these services and to add your voice to our ongoing campaigns for fair dairy prices.
The 3(d) program is proof that with a united voice we can achieve reforms that lead to real savings for our members. With our members’ help, the CRFA will be tracking price discounts from processors and distributors to make sure restaurant operators are receiving the maximum benefit from the 3(d) cheese class. We’ll be sharing this information with the CDC and our members.
So far, approximately 20 dairy processors and 60 distributors have signed on to the 3(d) permit program. However, it is entirely up to each company to decide how much of the discount to pass along to their customers: the CDC will not intervene. That’s why the CRFA “report card” will be so important to making sure you’re getting a fair deal from your cheese supplier.
This new approach to mozzarella pizza cheese pricing is far from perfect, but within Canada’s dairy supply management framework it’s a huge win for the restaurant industry. The CDC deserves credit for bringing together all the players – dairy producers and processors and the restaurant industry – to come to an agreement that lays the groundwork for further progress.
Many people in the industry have offered their thoughts on the new discount.
“A good example of how greater collaboration between the whole value chain can help grow markets for our farmers while keeping Canada’s restaurant industry competitive,” said federal agriculture minister Gerry Ritz.
The president of the Dairy Farmers of Canada Wally Smith said, “it is the farmers’ sincerest hope that this class will bring growth in sales of cheese in the restaurant pizza category.”
Don Jarvis, president and CEO of the Dairy Processors Association of Canada had this to say: “We’re delighted to work closely with the Canadian Restaurant and Foodservices Association to make the newly created 3(d) class of mozzarella cheese for restaurant pizza makers a great success. The price reduction will be a win for restaurateurs, while the anticipated increase in consumer demand for that cheese on pizzas will be a win for our members making mozzarella cheese.”
Clearly there were many players who had to come to the table and deliver the new 3(d) cheese class to Canada’s fresh pizza makers. Now it’s your turn to make it a reality in your restaurant business. The CRFA is proud to be your partner in making this program a success.
Garth Whyte is president and CEO of the Canadian Restaurant and Foodservices Association (CRFA). Founded in 1944, the CRFA has grown to 30,000 members across the country, including restaurants, bars, caterers and other foodservice providers, as well as suppliers to the industry. For more information, visit www.crfa.ca.