Business

Dairy body hails ACCC Coles’ action

THE Queensland Dairyfarmers' Organisation has welcomed news the ACCC has started legal proceedings against Coles supermarkets for alleged unconscionable conduct.

The QDO said it was a further demonstration of the urgent need for action to shield the dairy industry from the impacts of the supermarket milk price war, which has been led by Coles supermarkets.

The ACCC announced this week it alleges Coles "developed a strategy to improve its earnings by obtaining better trading terms from its suppliers..." with one way being "through the introduction of ongoing rebates to be paid by its suppliers in connection with the Coles Active Retail Collaboration program".

The ACCC alleges "that, in a number of cases, threats were made when suppliers declined to agree to pay the rebate".

QDO president Brian Tessmann said the allegations would sound familiar to Gympie region and Queensland dairy farmers, whom had been raising similar concerns for more than three years.

"From day one, when Coles first slashed the price of its store-brand milk to $1 per litre on Australia Day 2011, QDO has been very vocal in our concerns that this discounting of milk was unfair and robbed the fresh milk value chain of sufficient value to be sustainable," Mr Tessmann said.

"We have raised very serious concerns about unconscionable conduct, predatory pricing and loss-leader marketing tactics, where milk is priced so cheaply in order to not just attract customers, but also to grow the market share of their own brand."

Topics:  accc coles queensland dairyfarmers organisation

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