$1 Milk Not Predatory Or Detrimental To Farmers: ACCC

When Coles lowered the price of its house brand milk to $1 a litre earlier this year and Woolworths quickly followed suit, there was much speculation that the move would either impact prices paid for farmers or found to be against competition rules. However, the ACCC (which we're covering a lot today, I know) has found that to date, the $1 milk pricing doesn't violate any relevant laws.

The ACCC's investigation found that the bargain milk prices had an impact on Coles' profits, rather than seeing the price paid to individual farmers reduced. That in itself isn't illegal; keeping prices down in order to damage competitors is what would attract regulator interest.

It also found that prices paid for milk to farmers (the "farm gate price") generally wasn't lower for supermarket brands:

It is the case that some processors pay some farmers a lower farm gate price for milk sold as supermarket house brand milk. However on the evidence we’ve gathered over the last 6 months it seems most milk processors pay the same farm gate price to dairy farmers irrespective of whether it is intended to be sold as branded or house brand milk.

Have you embraced $1 a litre milk with fervour, or stuck with pricier brands or a guaranteed local supply? Tell us in the comments.



    I've been getting Coles/Safeway(Woolworths) milk since it was introduced, and i will continue to do so esp now its even more economical (granted the price goes up elsewhere to cover so if im gonna pay the price elsewhere i may as well reap the benefits).

    Why pay more for the same thing? I've fully embraced the $1 milk..

    My three boys, wife and I go through about 8 litres a week. Thank god for $1 a litre milk!

    They may well be within regulations and just bending the rules rather than breaking them, but milk is just one area where the big two are being dicks! They have many products that are in direct competition with their suppliers. Essentially, at least in my view, they procure product, and sell it at a lower price than the competition can match! All well and good for those customers that are happy to buy, in many cases, substandard items, but when their regular suppliers can no longer supply product without dropping their standards and laying off, where will they get their product then? It all comes down to making money for the stock holders, and the rest of the world be-damned..!

    I still buy Dairy Farmers. I don't use much so it isn't a huge burden.

    Yet another example of Australian producers' inability to remain competitive and then crying poor to seek protectionism rather than modernize and adapt.

    This winging culture is a national embarrassment and consumers are sick of it.

      Are you seriously accusing the Dairy industry of whinging? They've nailed to the wall by the "big two", as have many other produce providers! They get 'told' what they will get paid, and they really don't have much of a choice in the matter. Woollies and Coles have pretty much decimated their competition, leaving the produce industry very few other places to sell their produce. Whinging bedamned!!

      Heh, this is why farmers' kids are leaving for city/town jobs in ever increasing amounts. it's bloody hard to make a buck out of farming and when you actually start to turn it around you get flood, fire or drought. you have no idea what you're talking about and if you tried to make a living doing what these people are doing you'd run crying back to the city in under 6 months.

    sure you are ahead with the milk..

    and as long as you don't buy anything else at coles or woolies you will be juuuust fiiine

    it is not about protectionism, it is just about having half a brain.

    ps. if you are a producer (instead of a blood sucking middleman) selling at below cost is not being competitive

    Coles Milk and A2 milk ($2.50) a litre is very different, and people actually do notice a difference with there bodies if they drink the Coles Milk or A2.

    Hearing from within Coles, they do sell Milk as a loss "to make customers happy" with Coles 5 year turn around plan (currently in 3rd year).

    I do agree what EckyThump says - although farmers get the same amount of money, people are not buying the branded Milk such as the A2 Milk, so they may get the same per Litre, but the quantity of what has been supplied may be reduced. There have been numerious times I have been to Coles, and all there is was the Coles brands - so in away, they are taking out the competition.

    Plus, when the Milk price got lowered, we ended up paying for it through fuel - which used to be cheaper than Milk, now it's not

    Julian, that is painfully il-informed. Coles et al provide 'guaranteed' buyers for the farmer, however these big chains pay less than 10c per L on average.

    That is well below cost price to produce it. If that continues is will result in the big chains pushing the local farmers out of the marker entirely (as is happening now)and as we ar ealso seeing, milk coming from SE Asia. I am all for globilisation and am a through and through capitalist, but the ACCC findings are weighted on "Coles has agreed to buy 100,000L of milk from these farmers - thats heaps" with little regard for the cost of production.

      If the milk is coming from anywhere but australia, i have a problem with it, they should be forced to print "IMPORTED" in big bold letters on the containers.

    On a visit to Coles yesterday, 1L of Coles branded milk is now $1.25.

      It always has been (since the $1 milk started), its $1/L for 2L, which i find fair, at home i always buy milk in 2L.

    Surely the points are
    1. From where does Coles get this milk
    2. How much do they pay for it

    As I read ACCC statements all seems ok!

    I buy Devondale UHT milk (I'd buy fresh milk from them if it was available). They and Bega are, AFAIK, the last Australian-owned dairy company.

      Betta Milk is Aussie-owned, but only available in Tasmania. I'm sure there are other non-national dairy producers that are fully Australian-owned.

    We buy soy milk. If every we need cows milk, we buy the 500ml cartons - Dairy Farmers usually I think.

    If you wanna hurt the big supermarkets go to Coles and Safeway and buy all their heavily discounted stuff and then head to IGA for everything else.


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