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Well, actually, I think this is increasingly being highlighted as a problem. For example a few years ago in Australia it was a big issue that the supermarket d
by andyferris 3y ago
Well, actually, I think this is increasingly being highlighted as a problem.
For example a few years ago in Australia it was a big issue that the supermarket duopoly was intentially making their brands of milk too cheap. There was a kind of spiral where expensive brands weren't selling well, so farmers had to sign restrictive contracts with the big supermarkets, but the rates were too low to be profitable or even viable.
The conflict of interest sort of "broke" the free market for milk. I'm not sure if retailers should be forced to be "brokers or producers but not both" but I am sure that if they were purely "brokers" then we wouldn't have experienced this particular problem. (The fact that the supermaket business is so centralised is another related issue).
- dantheman 3y agoDid the price of milk get higher or did it just stay lower?
- avar 3y agoI wasn't familiar with the Australian "Milk Wars", and went down a bit of a rabbit hole. This $1/liter pricing appears to have started on Australia Day in 2011, and continued until 2019. But in this summary [1] of the report that Australia's competition regulator released in 2018 we can see that the price/liter that farmers were getting during this period doesn't seem to have been affected by the $1/liter pricing. The ACCC found (quoting [1]): "no direct relationship between retail private label milk prices and farmgate prices", and that neither the rate at which farms closed down, or their profitability was affected by the $1/liter milk. 1. https://www.farminstitute.org.au/briefing-dairy-regulation-and-floor-pricing/ https://www.farminstitute.org.au/briefing-dairy-regulation-a... 2. https://www.accc.gov.au/about-us/publications/dairy-inquiry-final-report https://www.accc.gov.au/about-us/publications/dairy-inquiry-...