International milk price controversy!

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Milk prices are big news around the world. Despite our competition watchdog clearing the supermarkets of wrong-doing in a recent report, in the UK, supermarkets and dairy producers have just been fined around $75m AUD for their milk and cheese pricing. The story is here. And in New Zealand the government is looking at an inquiry into supermarket milk pricing. The story is here.

Of course, careful and cautious readers of this blog site will realise that the issue in the UK and NZ is high milk prices, not the low milk prices that have caused consternation here in Australia. Indeed, New Zealanders seem to look enviously across the Tasman at our supermarket milk prices.

In Australia, milk’s cheaper because there’s no GST on it and supermarkets there use it as a loss leader, drawing you in with cheap milk so that you do the rest of your shopping there. Here the supermarkets seem to prefer wine, soft drinks and petrol discounts – none of which have the positive value of a healthy glass of homegrown milk.

The article is here.

So milk policy is clear. If the supermarkets price milk too high then we need an inquiry and the supermarkets may be colluding. If the supermarkets price milk too low then we need an inquiry as well.

2 Responses to "International milk price controversy!"
  1. The solution is obvious, all milk shall henceforth be sold only through shopfronts of the Federal Milk Bureau, under the aegis of the Department of Dairy.

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