30 Aug 2017
DUNNES STORES AND ALDI UNDERMINING SUSTAINABILITY OF FRESH MILK PRODUCERS IN CYNICAL MARKET GRABBING MILK PRICE WARLiquid Milk
Farmers are concerned that the long-standing Dunnes’ market share grabbing discount of milk at 67c/l is starting to degenerate into a milk price war, which will undermine the sustainability of fresh milk producers, with Aldi cynically joining Dunnes this week.
“Specialist liquid milk producers, like all primary producers of fresh food, depend on being able to make a reasonable income from the retail chain. This is something that is being recognised in Europe, with draft legislation on equity in the food chain expected next year, and French retailers currently agreeing to pass back increased wholesale prices to farmers,” IFA President Joe Healy said today.
Mr Healy was leading a protest by liquid milk producers outside Dunnes Stores and Aldi in Portlaoise today.
“There is no such thing as cheap milk. Fresh milk producers incur high costs and legitimately expect to be able to cover their costs and make a reasonable income from their specialist milk production. Yet, experience tells us that farmers always come out the worst of these cynical grabs for market share by retailers. Any apparent benefit for consumers is short-lived, with the security of year-round, local supplies of milk from freshly calved cows being threatened by the erosion of margins in the chain,” Mr Healy said.
Chairman of the IFA National Liquid Milk Committee, John Finn added: “We have met with most dairies and retailers – including Dunnes Stores and Aldi – to discuss our Milk Wise 2025 Strategy to protect the sustainability of fresh milk production in the best interest of Irish consumers.
“While they asserted their commitment to sustainability of supplies in our discussions, it is clear that Dunnes’ and Aldi’s actions do not match their words. They are devaluing our milk, potentially setting off a downward spiral in prices which farmers will, as usual, end up paying for.
“I call upon Dunnes Stores, Aldi and all retailers in Ireland to desist immediately from the race to the bottom on retail milk prices. I also call on dairies to resist the bullying pressures from retailers to undercut one-another in a value-sapping, perverse, market logic which can only lead to falling producer prices and fresh winter milk shortages for consumers,” he said
IFA President Joe Healy concluded: “Instead of these short term, ill-thought out tactics, dairies and retailers should take a leaf out of their French counterparts’ book, by making a public commitment to pay an increased price within the chain that allows for farmers to make a reasonable living, cover their costs and pay themselves a modest wage. Only this type of approach will secure the sustainably of locally produced, high quality fresh milk for Irish consumers for the long term”.