Australia: Mega-milk deal creates ACCC concern

The Australian Competition and Consumer Commission (ACCC) has expressed concerns about the proposed purchase of dairy processor Murray Goulburn by Canadian company Saputo, saying it could lead to lower payments to farmers in western Victoria for their milk.

In a much anticipated statement released on Thursday, March 1, the ACCC said it was concerned the deal would lessen competition for milk and see one company own about two-thirds of the milk processing capacity in south west Victoria.

That situation means the processors would be more likely to offer lower prices to farmers as many dairy farmers would have “limited alternatives,” it warned.

“We are concerned this transaction would ultimately lead to lower prices being paid to dairy farmers in the region,” ACCC chairman Rod Sims said.

Analysts said it was not yet clear whether the ACCC’s objection, which related to a single dairy plant, the Koroit plant in western Victoria, would scupper the deal.

Full Content: Reuters

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