10 June 1999
Report will urge end to Milk Marque
by FWi staff
THE Competition Commissions long-awaited report into the milk buying system will recommend the break-up of Milk Marque, according to The Independent.
The newspaper expects the report to encourage farmers to “add value” to the product by undertaking milk processing for the mass market.
But it also anticipates it will be “quite hostile” to farming interests, recommending the enforced break-up of Milk Marque.
Ministers have been careful to stress in recent weeks that farmers are to be allowed to “add value” to their raw material and get “closer to the consumer”, says the paper.
In plain English what this means is that they will be able to undertake milk processing for the mass market (into butter, cheese, yogurt etc) and distribution of the resulting products direct to the big national retailers, thereby gaining access to the full margin on their milk.
The break-up of Milk Marque is an inevitable quid pro quo for allowing farmers into the value-added chain, the paper continues.
It would plainly be highly anti-competitive for a monopoly supplier like Milk Marque, with more than 55 per cent of the market, to have its own processing facilities; the temptation to disadvantage the rest of the processing industry and fix prices would be too much to resist.
At more than 1,000 pages, the report is a real door-stopper, says the paper.
An announcement on its publication is expected within the next week or two.