Kiwis slam milk pricing

00:18, Mar 22 2011
Milk
HOW MUCH? A survey has found 91 per cent of New Zealanders think they are paying too much for milk, and most of them want an official inquiry into pricing.

A Consumer New Zealand survey has found 91 per cent of New Zealanders think they are paying too much for milk compared with other supermarket staples and 79 per cent want a government inquiry into milk pricing.

The survey of 1,000 New Zealanders asked for their views about milk and other dairy prices.

Consumer New Zealand chief executive Sue Chetwin said the survey showed 66 per cent of people knew that one milk processing company - Fonterra - collected 90 per cent of all milk produced in New Zealand and 79 per cent of them thought that led to higher prices for consumers.

Eighty per cent either agreed to strongly agreed that greater competition in the domestic dairy market industry would lower prices.

Consumer NZ has formed a coalition with other community groups calling for a government inquiry into dairy prices following steep increases in recent times. International dairy prices have risen nearly 18 per cent this year alone and reached record levels earlier this month.

Chetwin said Kiwis were paying international prices for milk and other dairy products but there was concern New Zealanders may in fact be paying even more than that due to lack of competition here.

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The only major competitor to Fonterra in the local market is Goodman Fielder which buys its milk from the dairy giant.

A recent Ministry of Agriculture and Forestry report said it didn't know if there was sufficient competition in the domestic milk market.

Its report has been criticised as inadequate and lacking in analysis by Consumer, small dairy processors and Green MP Sue Kedgley.

The survey showed 50 per cent of people thought pricing was unclear and 76 per cent were concerned at how much they paid.

Fonterra and the country's two supermarket chains, Foodstuffs and Progressive Enterprises, will not discuss their margins on milk.

Last month Farmer-owned Fonterra froze the price of wholesale milk to the domestic market for the rest of the year in response to public anger. The two supermarket chains also froze their prices.

BusinessDay.co.nz