By Caitlyn Gribbin- Wednesday, 27/02/2013
A report from international rural financier Rabobank shows fresh milk discounting is rampant in the world’s major dairy markets.
The report is yet to be released, but Rabobank senior analyst Michael Harvey says milk price wars are a major part of supermarket trade in the United States, United Kingdom and Europe.
He says Australian dairy farmers might be worse off than their international peers, because there are more steps in the supply chain.
“What we’ve probably seen in other parts of the world, and it’s particularly strong in the United Kingdom, is where you’ve got a supermarket who will deal directly with farmers and negotiate a fair milk price to try and provide clarity and transparency to the way the pricing works along the value chain,” he said.
“Generally, I think the farmers are a lot more comfortable with the process; they can actually negotiate a price directly with their major customer to market.”