Australia: Competition watchdog to widen dairy industry investigation

Australia’s competition watchdog will launch a broad investigation into the country’s dairy industry, the country’s deputy prime minister Barnaby Joyce said on Thursday.

The investigation comes after Australia’s largest dairy processor Murray Goulburn and New Zealand’s Fonterra Co-operative Group in April reduced the their farm gate prices, or what they pay farmers for their milk, by nearly 20 percent. This new price is below the break even costs for a number of farmers, leaving many of them financially struggling.

The Australia Competition and Consumer Commission (ACCC) launched an investigation into the timing and notice of the cuts, but Joyce said the ACCC will launch a broader investigation.

“An in-depth and independent inquiry is a thorough and fair way to uncover inefficiencies and inequities that our farmers face – and identify a way forward,” said Joyce, who is also acts as the country’s agriculture minister.

“The ACCC inquiry, to begin in November, will investigate sharing of risk along the supply chain, supply agreements and contracts, competition, bargaining and trading practices in the industry and the effect of world and retail prices on profitability.”

Full Content: Reuters

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