Tolling
Tolling in the dairy trade involves a contractual agreement where one party (the toller) processes raw dairy materials provided by another party (the client) for a fee. The client retains ownership of the raw materials and finished products throughout the process. This arrangement allows dairy producers to leverage external facilities for processing without investing in infrastructure. Typically, the client supplies raw milk or other dairy inputs, and the toller converts these into desired products, such as cheese, butter, or powdered milk, according to specified standards. The tolling fee usually covers labor, utilities, and operational costs incurred by the toller, depending on the final product chosen. This process helps clients manage production costs, access advanced processing technologies, and meet fluctuating market demands while focusing on core business activities like sourcing and marketing.
A crucial question is which product to produce from the raw milk. This decision is based on market prices, margins, available production capacity, and other factors. Dycotrade provides clients with real-time insights to make the right choice repeatedly.