31 October, 2007
Milking the farmers
In an article about alleged price-fixing of dairy products sold in supermarkets, the BBC quotes an average retail price of 56.3p for a litre of milk, of which only 18.08p goes to the originating farmer. Less than a third – pretty disgusting, really.
I'm all for commercial competition, but I feel that price cuts should come out of the retailers' profits rather than being borne by the suppliers.
Ultimately, the power is in the wrong place. If milk producers formed a cartel and dictated the price at which they'll sell to retailers, somehow I wouldn't mind so much.
If the retailers passed on the increase (absolute, not proportionate!) to customers, fair enough, though I might well favour from the retailer willing to accept the lowest profit margin. And if that means supermarkets, genuinely outcompeting corner shops, that's fine with me – I'm not inherently anti-supermarket.
Posted by Ministry at 11:38
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