“Across Ontario, small dairy processors are being held back by outdated regulations that leave no room to grow. This isn’t about lowering standards — it’s about creating a fair system that reflects today’s food landscape.”

Ontario’s dairy regulations were designed for large-scale production, but they are now limiting the growth and sustainability of small, value-added dairy businesses across the province.

Under the current Milk Act, small processors are effectively restricted to direct-to-consumer (B2C) sales unless they operate from a fully licensed dairy plant. While this system works for large-scale operations, it creates a significant barrier for small businesses trying to grow responsibly.

Many small dairy producers already use milk that has been properly pasteurized in approved facilities. Despite this, they are still required to produce within a licensed dairy plant in order to sell wholesale. The cost and scale of accessing or building such facilities are often unattainable for small businesses.

Additionally, small producers face restrictions on how they can deliver their products. Even when using safe, modern logistics solutions, producers are often not permitted to utilize third-party, temperature-controlled shipping services to deliver products directly to customers. These companies specialize in maintaining strict cold-chain standards, yet current rules limit their use, further restricting market access and customer reach.

As a result, small producers are left with only two options:

Stay small and sell directly to consumers
Attempt to scale immediately to meet large commercial requirements

There is no practical “middle tier” that allows for gradual growth into wholesale markets such as local grocery stores, cafés, and independent retailers.

This gap in the system is preventing small Ontario businesses from expanding, limiting consumer access to locally made dairy products, and restricting innovation within the sector.

We are asking the Province of Ontario to modernize the Milk Act by introducing a tiered regulatory system that supports small-scale dairy processors while maintaining food safety standards.

Specifically, we call for:

A Small-Scale Processing Tier

Allow limited wholesale distribution without requiring a full dairy plant license
Set reasonable production and sales caps appropriate for small businesses

Recognition of Pasteurized Inputs

Allow value-added dairy products made from already pasteurized milk to be produced outside of a dairy plant under regulated conditions

Scaled Compliance Requirements

Implement food safety standards that are proportional to production size and risk level

Modernized Distribution Rules

Permit the use of licensed, third-party temperature-controlled shipping providers
Support safe, trackable cold-chain delivery directly to consumers

Clear Pathways for Growth

Create a step-by-step regulatory pathway so businesses can scale from local to larger markets without major financial barriers

Supporting small dairy processors means:

Strengthening Ontario’s local food system

Creating more opportunities for farmers and entrepreneurs

Increasing access to locally made, high-quality dairy products

Encouraging innovation in production and distribution

Other sectors of the food industry already benefit from tiered systems and modern logistics — dairy should not be left behind.

Ontario has an opportunity to lead by creating a modern, flexible regulatory system that supports both food safety and small business growth.

We urge policymakers to work with small dairy processors to create fair, practical changes to the Milk Act.

Support small dairy. Support local business. Support smart regulation.