In brief
- Canada already makes the protein. Every kilogram of Canadian cheese leaves nine or ten litres of whey behind, and the protein is in the nine. The milk is paid for. The plant is licensed. Nothing new has to be grown.
- The plan is one skid beside one vat: about $1.8 million installed, on the floor of a plant that already has the licence, the milk and the waste. Not a new factory. Not a new cow. Not a new quota.
- One skid on one day: 100,000 litres of sweet whey in; 794 kg of cream sold first, about 3,000 litres of protein to a dryer we rent, and the water back to the plant. 650 kg of powder a day in the cautious case.
- The year returns about $2.8 million before interest and tax in the base case. Cream alone covers drying, freight and power. At $14 a kilogram it still clears about $2.1 million.
- Until now that whey left as water and came back as powder: about 90% of the high-protein whey Canada imports has been American. In September both doors closed in one month: a 50% surtax on the return from 8 September, and listed Canadian whey stopped at the American border from the 29th. The loop no longer pays, which is the moment to stop running it.
- The money: one federal door is open to a licensed cheese plant, up to $10M, non-repayable. The plant-protein fund will say no, and the interest-free loan is closed. Eight desks can stop it, and the page says what each is shown.
- No cheese plant, dryer or brand has agreed to any of this. The sequence is the work.
- 9 L
- of whey for every kilogram of Canadian cheese. The protein is in the nine.5
- $1.8M
- the skid we model, beside a vat. Not a new factory.
- 50%
- surtax on the powder we have been buying back, since 8 September 2026.2
How to read this
Every published figure here is dated and sourced in the receipts at the end. Every figure of the plan’s own is a planning model, October 2026, and the page says so wherever one appears; the model’s inputs are written once in the site’s source, every number that follows from them is computed on this page rather than typed, and the words used here explain the terms.
It is written for the people it would need: a cheese plant, a dryer, a blender, the dairy desk at Agriculture and Agri-Food Canada, a milk board, and anyone with a corner of a floor and a reason.
01 · The loop We already milked it.
- Vat
- A Canadian cheese plant separates curd from sweet whey. The milk was already bought. No new cow. No new quota.
- South
- The whey, mostly water, has been shipped to be dried in the United States, then sold back to Canada as powder.
- Back
- About 90% of the high-protein whey Canada imports still comes from the United States.1
The return is now taxed. Since 8 September 2026 that powder carries a 50% surtax. The loop no longer pays.
02 · The border Both doors closed in September.
8 Sept
Canada
A 50% surtax on United States whey. Customs Notice 26-23.2
29 Sept
United States
Listed Canadian whey stopped at the border.1
| Average US whey protein concentrate | US dollars a tonne |
|---|---|
| August 2023 | US$5,620 |
| August 2026 | US$28,160 |
03 · The penalty What a kilogram costs now.
| Line | Before | This autumn |
|---|---|---|
| US wholesale | About US$3.70 a pound in mid-2025, implied by the 250% rise to June.3 | US$10 to $11 a pound. June peaked at US$13.3 |
| Surtax, HS 0404 | None under CUSMA. | 50% since 8 September 2026.2 |
| The US door | Canadian whey could enter. | Listed powders stopped, 29 September.1 |
| Planning rate | $1.37 in 2024. | $1.40.4 |
| Landed, our sum | Duty-free. | About $46 to $51 a kilogram, Canadian, before freight. |
| What we model | $17.50 a kilogram. A little over a third of that landed price. | |
| One tonne of powder | Roughly $15,000 of the bill is the surtax alone. |
| A kilogram of US powder | At US$10 a pound | At US$11 a pound |
|---|---|---|
| In Canadian dollars, at $1.40 | $30.86 | $33.95 |
| With the 50% surtax | $46.30 | $50.93 |
| What we model, Canadian powder | $17.50 | $17.50 |
Try it Build the landed price.
Move the American price and the exchange rate, and switch the surtax off to see what it alone adds. The black mark is the $17.50 the model asks for Canadian powder.
- $46.30
- a kilogram, landed in Canada, before freight
- $15.43
- of that is the surtax
- 38%
- is where $17.50, the model’s Canadian price, sits against it
04 · Not this. This. Do not build a factory. Sit beside the vat.
Not this
Raw whey is about 93% water. It spoils in hours. A tanker of it is a tanker of water.5
A greenfield spray dryer is the $15 to $30 million machine, inside a $50 to $100 million plant, and two or three years of permits.
$50–100MAnd two or three years of permits.
This
Phase one is a skid on the floor of a plant that already has the licence, the milk, and the waste.
Sweet whey only. Cheddar, mozzarella, gouda. pH 6.0 to 6.5. Acid whey from cottage cheese or Greek yogurt is refused. It scales the membranes.5
$1.1–$2.2MWe model $1.8M.
05 · One day One hundred thousand litres.
- 794 kg
- Whey cream, 40% fat. About $810,263 a year. This cheque arrives before a kilogram of powder is sold.
- ~3,000 L
- Protein retentate at 25% solids. Volume down 97%. This is what gets hauled, cold, to a dryer we rent.
- ~95,000 L
- Permeate. Lactose and minerals. Water recovered for the plant’s own wash. The waste load leaves with it.
650 kg
Powder a day. The cautious case. 195 tonnes a year. This is the number in the ledger.
1,054 kg
What the membranes could yield. Shown so it is not hidden. Not used in the base case.
Planning model, October 2026. Cream revenue is held flat because it comes off the clarifier, not the dryer. Toll drying is $2.25 a kilogram and moves with the powder.
06 · Three cases The year, three ways.
| Line | Downside | Base | If yield holds |
|---|---|---|---|
| Powder a day | 650 kg | 650 kg | 1,054 kg |
| Price a kilogram | $14.00 | $17.50 | $17.50 |
| Powder revenue | $2,730,000 | $3,412,500 | $5,533,500 |
| Whey cream | $810,263 | $810,263 | $810,263 |
| Revenue | $3,540,263 | $4,222,763 | $6,343,763 |
| Toll drying, $2.25 a kilogram | −$438,750 | −$438,750 | −$711,450 |
| Chilled freight | −$195,000 | −$195,000 | −$195,000 |
| Labour, five people | −$410,000 | −$410,000 | −$410,000 |
| Power and wash | −$180,000 | −$180,000 | −$195,000 |
| Membranes, enzymes | −$120,000 | −$120,000 | −$135,000 |
| Licence, lab, insurance | −$95,000 | −$95,000 | −$95,000 |
| EBITDA | $2,101,513 | $2,784,013 | $4,602,313 |
| Loan, if it is made | −$126,000 | −$126,000 | −$126,000 |
| Left to split | $1,975,513 | $2,658,013 | $4,476,313 |
| Payback on $990,000 | 6.0 months | 4.5 months | 2.7 months |
Figure 5 · Planning model, October 2026. Cream is the same in every column because it comes off the clarifier. The right-hand column is what the membranes could yield. It is not the plan. AgriInnovate, the interest-free loan in that row, is closed.6
A planning model, not a term sheet. At $14.00 a kilogram the same plant still clears about $2.1 million EBITDA. The 45% grant is not in hand. Cream alone covers drying, freight, and power.
Try it Run the skid yourself.
The same arithmetic as the ledger, with five inputs you can move. Labour, freight, power, membranes and the licence stay at the base case: a loop twice the size would move them, and the model does not pretend to know by how much.
- $2,784,013
- EBITDA for the year
- 4.5 months
- to pay back the $990,000 a grant does not cover
- 2.7¢
- a litre back to the host plant: $797,404 a year
- 650 kg
- of powder a day, 195 tonnes a year
Revenue $4,222,763
powder $3,412,500 · cream $810,263
Costs $1,438,750
toll drying $438,750 · freight $195,000 · labour $410,000 · power $180,000 · membranes $120,000 · licence $95,000
Left after the loan $2,658,013
the bars share one scale: the year’s revenue is the full width
07 · The plant What the cheese plant is paid.
$0 a litre up front
The whey is not purchased. It is the stream the plant already separates, and used to pay to haul away.
Hot water back
Polished water returns warm, into the plant’s own wash. Less city water. Less gas.
The cream first
$810,263 a year from whey cream, before a kilogram of powder is sold. It covers drying, freight, and most of the power.
2.7¢ a litre after
On the base case, 30% of what is left goes back to the member plant. About $797,000 a year. A split in the model, not a promise.
30 million litres a year. $797,404 is 30% of the $2,658,013 left after costs and the loan in the base case. The other 70% is a reserve and the operator’s share. Nothing here is agreed.
08 · The skid Where the $1.8 million goes.
| Line | Low | High |
|---|---|---|
| Clarifier and cream separator | $150,000 | $300,000 |
| Ultrafiltration and diafiltration skid | $450,000 | $900,000 |
| Clean-in-place, and water recovery | $100,000 | $200,000 |
| Two chilled tanks | $120,000 | $250,000 |
| Heat exchangers and a chiller | $80,000 | $150,000 |
| Stainless tie-in and commissioning | $200,000 | $400,000 |
| Installed, no spray dryer | $1,100,000 | $2,200,000 |
- $810k
- Only if SMPIF covers 45%. The cheese plant has to apply. That share is our ask, not a rate the program publishes.7
- Closed
- AgriInnovate is the interest-free loan. Its intake is shut. This model no longer spends that money.6
- $990k
- What is actually left. Members, then a lender against a purchase order. Interest is not in the EBITDA.
Agriculture and Agri-Food Canada lists AgriInnovate as closed. Repayment, when the program is open, is interest-free. It is not open.6
09 · Where it goes Feed, or a sewer. Not a powder.
Nine litres
Nine or ten litres of whey leave the vat for every kilogram of cheese. The milk was already paid for. The protein is in the nine, not the one.5
The small plant sells it as feed
For the plant without a dryer, livestock feed is the option that clears. Research by Julien Chamberland’s team at Université Laval, presented at an Ontario symposium in 2024, found it the only viable option for the smallest plants. The same group’s 2026 Quebec study found the same thing.8, 9
The surplus is not small
Dairy Farmers of Ontario’s chair said the province needed another billion litres of processing capacity for the solids-not-fat surplus. That is capacity, not a count of litres poured out.8
When feed will not take it
Cheese whey carries 30,000 to 50,000 milligrams of oxygen demand per litre, and more. A municipal sewer is built for a few hundred. We will not claim a national figure for how much is flushed. The failure mode is the drain.10
10 · The money One door is open. One will say no.
| Door | What it actually funds | Us |
|---|---|---|
| SMPIF | Dairy processors. New equipment. Non-repayable, up to $10M. Intake open. Ends 31 March 2028.7 | Yes, if the cheese plant applies. A new company cannot. |
| Protein Industries Canada | Plant protein. Its own line is “a global leader in plant protein.” Consortium, up to about 45%. It has funded a brewery byproduct.11 | No. We do not qualify, and we will not pretend to. The argument is that the policy stops at the plant door. |
| AgriInnovate | Repayable. Interest-free when it is open. Normally up to $5 million.6 | Closed. The earlier stack that leaned on it is withdrawn. |
| Provincial dairy funds | Ontario’s modernization stream paid up to $200,000 a plant. Its intake closed 13 February 2025. Real money, when it is open. Not a skid.12 | A top-up if a successor opens, after the federal file. Not the plan. |
| BC Manufacturing Jobs Fund | Capital for B.C. manufacturers, when an intake is open: up to 20% of a project, $100,000 to $10 million.13 | The last capital intake closed in 2024. A $30 million renewal was announced in October 2026 with no intake date. Watch it. Do not book it. |
11 · Who can stop it Eight desks. Any one of them.
| Who | How they stop us | What we put in front of them |
|---|---|---|
| The cheese plant | No letter, no whey, no file. | Nothing up front. Hot water back. A share of the year, if the year makes money. |
| The milk board | If this looks like milk moving around the board. | No new cow. No new quota. Whey only, after the vat. In B.C., the BC Milk Marketing Board. In Ontario, Dairy Farmers of Ontario. |
| The Dairy Commission | If the solids get reclassified and the pool objects. | The milk was already paid as cheese milk. We are not buying a new class. |
| CFIA | A new activity that is not on the licence or the preventive control plan. | The plant amends its plan. Bulk sacks under section 247. Not a new food company.14 |
| Health Canada | A tub that claims to build muscle. That is a natural health product, and it needs a number before sale.15 | We do not sell a tub. The buyer already holds the product licence. |
| Environment, and the sewer | Permeate dumped, or a new outfall. Lactose still has an oxygen demand. | Protein and cream leave the drain. Lactose goes to a feed or fermentation buyer. Recovered water is reuse, not a discharge. |
| The blender | No purchase order, no lender. | A certificate of analysis first. Then a take-or-pay. Not a handshake. |
| Our own members | If we treat a closed program as cash. | $990,000 has to be found without AgriInnovate. Some of it from us. |
Safe Food for Canadians Regulations, section 247, is the bulk-dairy label. The natural health product line is Health Canada’s boundary, not a slogan. Nothing on this page is a consent from any of these desks.14, 15
12 · Who can file The cheese plant applies.
The plant
A licensed dairy processor, with books. A new company cannot carry this file. The fund wants the licence and the history: two complete financial statements covering three years of revenue, at least two of them from processing.7
Stage 1
A project summary to the dairy desk at Agriculture and Agri-Food Canada. Non-repayable, up to $10M, program open to 31 March 2028. An application is not an approval.7
The skid
We bring the equipment, the offtake, and the reason the file is worth writing. Installed capital in the model, $1,800,000.
The buyer
Bulk powder to a Canadian blender who already holds a product licence. Not a claim on a tub. Not a school program. Plant-protein funds do not cover dairy whey.11
Agriculture and Agri-Food Canada, Supply Management Processing Investment Fund. Dairy intake open. Budget $397.5M. Stage 1: aafc.smpif-fitpgo.aac@agr.gc.ca.7
13 · The ask Fund the equipment that stops a waste and a surtax.
01
One plant
A licensed cheese plant, already separating sweet whey, willing to be the applicant.
02
One skid
Beside the vat. Not a new factory. Not a new cow. Not a new quota.
03
One powder
Sold in Canada, as an ingredient. Schools and the Forces can buy it once a plant is actually making it.
We are not asking for a set-aside. We are asking that protein we already milked be dried here, instead of poured out and bought back.
Carry it One line to each desk.
This plan needs a few people who already hold a piece of it. If one of these is your desk, the link opens a message to us with the desk in the subject line. Nothing else is collected, and nobody’s name goes on a list.
- A cheese plant separating sweet whey, with a corner of floor and a reason. The first letter is yours to write.
- A dryer with a spray tower and a toll rate. A term sheet before anyone welds a frame.
- A blender holding a product licence, who would read a certificate of analysis and talk about a take-or-pay.
- A milk board, or the Dairy Commission, who can say early whether whey after the vat is anything the pool minds.
- The dairy desk at Agriculture and Agri-Food Canada, if the file reads as one worth a Stage 1.
- Anyone who knows what breaks first. If a number above is wrong, that is the message we most want.
14 · Twelve months The order of work.
- Months 1 to 2
- Three directors. A letter from one host plant for about 100,000 litres a day and a corner of the floor. Five litres of sweet whey, cold, the same week. No co-op until a plant says yes.
- Months 3 to 4
- A pilot powder and a certificate of analysis. Then the Stage 1 summary. A toll-dry term sheet before anyone welds a frame.
- Months 5 to 8
- A take-or-pay from one blender, about $16.50 to $17.50 a kilogram, 24 months. That contract is what a lender can read. Then the skid is built.
- Months 9 to 12
- Stainless into the existing vat. The preventive control plan. Bulk sacks, not a retail tub. Cream one way. Retentate the other. Powder back.
Northern Temper
October 2026
Words used here Nine terms, plainly.
- Sweet whey
- The liquid left when rennet sets milk into curd for cheddar, mozzarella or gouda. About 93 to 94% water, with a little under 1% true protein. Acid whey, from cottage cheese or Greek yogurt, is more acid and higher in minerals, and it fouls membranes; the plan refuses it.5
- Clarifier and cream separator
- A centrifuge that spins out curd fines and most of the fat before the whey reaches the membranes. The fat leaves as 40% cream, which is the first thing sold.
- Ultrafiltration
- Pushing whey through a membrane that holds back the large protein molecules and lets water, lactose and salts through. What stays is the retentate; what passes is the permeate. Diafiltration adds clean water to wash more lactose out.
- Retentate
- The protein side of the membrane: about 3,000 litres a day at 25% solids, from 100,000 in. Small enough to truck cold to a dryer.
- Toll drying
- Paying a plant that already owns a spray dryer to dry your retentate into powder, by the kilogram. The model pays $2.25 a kilogram rather than buying a $15 to $30 million dryer.
- Take-or-pay
- A contract where the buyer pays for an agreed quantity whether or not they take it. A lender can finance equipment against one; a handshake they cannot read.
- Surtax
- A duty added on top of the normal tariff, by order, as a countermeasure. Canada’s on United States whey is 50% of the value for duty, from 8 September 2026.2
- EBITDA
- Earnings before interest, tax, depreciation and amortisation: what the year leaves after operating costs and before the cost of the money that built it.
- SMPIF
- The Supply Management Processing Investment Fund, Agriculture and Agri-Food Canada’s non-repayable fund for dairy, poultry and egg processors buying equipment. Up to $10M a project; the dairy intake is open until the $397.5M is committed or 31 March 2028.7
Sources Every figure, named.
- Financial Post, "How Canada's 50% whey tariff is backfiring on Canadian protein makers," 21 September 2026 (the PDF credits Andrew Rankin): "Canada imports roughly 1,000 tonnes of high-protein whey a month, about 90% of it from the U.S."; Canadian production of WPC80 and isolate is "next to none" beside the American; and "Beginning Sept. 29, the U.S. will prohibit imports of specified Canadian whey." The prohibition is Proclamation 11062 of 8 September 2026, effective for goods imported on or after 29 September, whose annex lists whey protein concentrates, modified whey, fluid whey and dried whey; the 50 per cent American duty on Canadian dairy that preceded it is Proclamation 11047, signed 20 July and in effect from 22 August 2026. whitehouse.gov · govinfo.gov
- Canada Border Services Agency, Customs Notice 26-23: United States Surtax Order (2026), Ottawa, 7 September 2026: "Effective September 8, 2026," goods in schedule 3 carry a surtax of "50% of the value for duty." cbsa-asfc.gc.ca. The Order, SOR/2026-186, Canada Gazette Part II, 23 September 2026: Schedule 3 lists 0404.10.10 to 0404.90.20, the whey lines, at 50 per cent; cheese under 0406 is in Schedule 2 at 25. gazette.gc.ca
- Vesper, as the Financial Post cited it (note 1): average United States price of whey protein concentrate, more than US$28,160 a tonne in August 2026, from about US$5,620 a tonne in August 2023. The Post's page could not be opened from where this edition was prepared, and no other outlet repeats the two tonne prices, so they stand as the author's cited claim. What is verified says the same thing: CNN, 27 September 2026, on USDA data, has WPC at a record US$13 a pound by June, a 250 per cent rise year over year, and "around $10 to $11 a pound" since (cnn.com); USDA Dairy Market News for 19 to 23 October 2026 has WPC 80 "in the $9s and $10s" (ams.usda.gov); and NutraIngredients, 19 June 2026, citing Vesper, has WPC80 at US$32,000 a tonne against US$5,500 in the same period of 2023 (nutraingredients.com). The "about US$3.70" before is the June price divided by that 250 per cent rise.
- Bank of Canada, annual average exchange rates, US dollar in Canadian dollars: 1.3698 for 2024 and 1.3978 for 2025. The model's planning rate is the 2025 average, rounded. bankofcanada.ca
- Pires, Marnotes, Rubio, Garcia and Pereira, "Dairy By-Products: A Review on the Valorization of Whey and Second Cheese Whey," Foods 10(5):1067, 2021: "Around 9–10 L of whey results from the production of 1 kg of cheese," sweet whey at pH 6 to 7 and acid whey about 4.5 to 5.8. pmc.ncbi.nlm.nih.gov. Tetra Pak, Dairy Processing Handbook, chapter 18, table 18.1: cheese whey about 94 per cent water, 6 per cent solids; sweet whey pH 5.9 to 6.6. dairyprocessinghandbook.tetrapak.com. The pH 6.0 to 6.5 the plan takes in is its own intake specification inside that range.
- Agriculture and Agri-Food Canada, AgriInnovate Program: "Intake period: Closed"; contributions "on a repayable basis," normally not above $5,000,000 a project; "Interest is not charged on the contribution funding." agriculture.canada.ca
- Agriculture and Agri-Food Canada, Supply Management Processing Investment Fund: "The application intake period for contribution funding is open for dairy processors"; budget $397.5M from 1 April 2022 to 31 March 2028; up to $10M for a dairy processor, non-repayable; applicants hold "an active federal or provincial processing licence" and file "2 complete Financial Statements (which will cover three years of revenues)," with at least 24 months of processing revenue; Stage 1 is a Project Summary Form to aafc.smpif-fitpgo.aac@agr.gc.ca. agriculture.canada.ca. Confirm the program with the department before it is quoted as an offer.
- Farmtario, Stew Slater, "Dairy processors are challenged to find viable options," 8 March 2024, from the Southwestern Ontario Dairy Symposium: Chamberland on the equipment whey protein takes, his team's finding that for the very small plants "continuing to send all whey into the animal feed stream appears to be the only viable option," and Mark Hamel of Dairy Farmers of Ontario on "an additional billion litres in annual processing capacity" for the province's solids-not-fat surplus. farmtario.com
- Kpadé, Chamberland, Singbo, Pouliot and Doyen, "Evaluating Techno-Economic Performances of Solids Non-fat Valorization from Cheese By-products in the Province of Québec (Canada)," Waste and Biomass Valorization 17:8127–8145, 2026: for small plants, liquid whey to animal feed is "the only viable option." doi.org
- FAO, Thivend, "Use of whey in feeding ruminants," World Animal Review: whey has a "biochemical oxygen demand (BOD5) ranging from 30 to 40 g of oxygen per litre" (fao.org); Pires et al. (note 5) give about 50 g a litre for second cheese whey. Wisconsin Department of Natural Resources, 1998: ordinary dairy-plant wastewater at 2,000 to 3,000 mg/L is "10 times the strength of domestic sewage" (datcp.wi.gov). A published process range, not a national inventory.
- Protein Industries Canada: its vision is that "Canada is a global leader in plant protein," projects "must have a clear connection to plant protein," and co-investment is 45 per cent of a project's costs for a consortium of three or more companies (proteinindustriescanada.ca). "Terra Bioindustries and Great Western Brewing Company partner," 27 May 2026: $1.1 million into a brewery byproduct, $486,000 of it from the cluster. proteinindustriescanada.ca
- Ontario, Dairy Processing Modernization Initiative guidelines: at most $200,000 a plant across all projects; "Application intake for this Initiative closed on February 13, 2025." ontario.ca
- Government of British Columbia, BC Manufacturing Jobs Fund: "the program intake is currently closed"; "an additional $30M has been announced for a renewed BC Manufacturing Jobs Fund" (page updated 6 October 2026); the June 2024 program guide set the capital stream at $100,000 to $10 million and up to 20 per cent of eligible costs, with the last intake closing in 2024. www2.gov.bc.ca
- Safe Food for Canadians Regulations, SOR/2018-108, section 247: "Prepackaged dairy products — not consumer prepackaged." laws-lois.justice.gc.ca. Canadian Food Inspection Agency on whey cream in butter: inspection.canada.ca
- Health Canada, Classification of Products at the Food-Natural Health Product Interface: Products in Food Formats: powdered protein products represented with terms such as "muscle building" or sold in measured doses are typically natural health products (canada.ca); Natural Health Products Regulations, section 4: no sale without a product licence (laws-lois.justice.gc.ca).
A note on this edition. The skid cost, the daily yields, the $17.50 price, the cream, the operating lines and the EBITDA are our planning model, October 2026, computed on this page from its inputs. Six details were corrected against their sources before this edition was published, among them a provincial fund the PDF called open that closed in February 2025; two prices the PDF cites to the Financial Post could not be verified from here and are marked as the author’s cited claim where they appear. Programs and prices move; check the current version of each source before any of this is quoted as an offer. The page’s own record of each change is in its source.