Wednesday, March 09, 2011

Milk It, Baby

Is it just me, or is everyone else out there a bit confused about about what the HELL Coles, Franklins, ALDI and Woolies think they are doing to our milk supply?

For overseas readers; Coles, one of our major supermarkets has dropped the price of milk to $1 a litre, which is, by all accounts unsustainable.  The other supermarkets are following suit.

I have heard quite a few stories as to how the supermarkets are able to do this without destroying the dairy industry, and how (apparently) the money we 'save' on our milk is not coming directly from the pockets of our dairy farmers.
  • Coles reckons it gave the diary farmers a 'pay rise' last year to offset the drop in income from the cheap milk (sounds a bit elaborate but okay) - but what then are the other supermarkets doing, having been caught unawares by Coles aggressive grab for customers?  Giving pay rises to their suppliers?  Somehow I doubt it.
  • Another theory is that the supermarkets are diluting their milk with water or adding more permeates to it.  
    • Firstly, Baristas are reporting that the cheap milk is harder to froth, suggesting that either the milk is diluted or that fat has been removed (put simply fat makes froth). 
    • And Secondly WFT are permeates?? "Permeate is a waste product of dairy production created by removing all the fat {from milk} and then concentrating the material that is left, it can make up to 12 per cent of some milk brands in supermarkets.
      NSW farmers say permeate costs less for processors to buy than milk, so the two can be mixed to produce a cheaper product."
      Article here
    • I found this diagram (click to enlarge) about how they process milk...
    •  That makes you feel better about our milk supply doesn't it - natural product?? really??
  • Finally today they are saying that the supermarkets (both Coles and Woolies own a large number of petrol stations) are increasing the price of petrol to cover the shortfall in income/profit
The Senate Economic Committee has already started an inquiry into how this discounting can be happening, and the ACCC is being called on to get involved.  Which is great, if they actually do anything. 

Apparently eggs are next on the radar - I shudder to think what that price war will involve (increasing grain costs and less profits for the farmer will mean they will cut costs in areas that include quality of life for chickens, and the food that they are fed, which is ultimately the food you eat) - and I have forgiven our chooks for digging up the asparagus AGAIN.  

I've been loving the cheap milk, we go through around 6 litres a week - more if I'm making yoghurt and so on.  But after doing some research I just don't trust that the cheap milk is not a lesser quality product that is being produced at the expense of our dairy industry and the expense of the consumer at the petrol pump.  So I've decided that I'm going to start buying branded milk, organic if I can get it.  Yes.  Triple the price, maybe more, and we are utterly skint at the moment.  But I think its the right thing to do.  In fact, I don't think I have a choice.


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Belinda said...

Hi Caitlyn,

I have to agree with you when you say you don't think you have a choice. At +$3/L I always wince a little when I put the unhomogenised BD milk in my basket but all the research I have read etc says that the less processed the milk you consume the better it is for you.

Kind Regards

Rachael Johns said...

I soooooooo agree with you too. They are trying to crush the small supermarkets too. As an IGA X-Press owner who tries to do the best by our customers and offer TRUE service, we just can't compete when the big supermarkets play dirty!
Good on you!

Vanessa said...

Totally agree mate. Those supermarkets are dirty buggers and will stop at nothing to increase market share and profits. Customers, suppliers and the quality and taste of food are way down the bottom of their list of concerns.

Simpsonslover said...
This comment has been removed by the author.
Being Me said...

Superb post. Anyone who thinks there isn't something very fishy (or ... milky??) going on is not looking at the bigger picture.

(sorry, that deleted comment was me, damn old Blogger account rearing its head again)

greenfumb said...

Of course we will end up paying for it somehow.

Wanna go halves in a Jersey cow?

Sam-O said...

I read this the other day and sat nodding my head. I don't drink milk but since I had my boys we go through about 2 litres a day.

I already worry about preservatives as I have one child who goes mental with some.

As I mostly buy milk for my Boys (and hubbys coffee) I don't mind paying for REAL milk, but I am sure there are people who don't think about anything except the bottom line (and probably can't afford not to take the deal).

I spent a few days kicking it around in my head and BAM - I see an ad on tele for a story about this very thing. At least it is getting out into the general media and population to consider how they are doing this price reduction.

Good for you!! I bet they got the idea from you!

Liz Beavis said...

I can't believe I didn't notice post at the time, I have my own more wide-ranging conspiracy theory about raw milk (see my blog) and totally agree with you, nothing good can come from this!  We can save money by buying less processed foods and then have extra to spend on quality ingredients, including raw milk and fresh fruit and vege (also free range eggs, more on my blog on that one too).  Anyway, just wanted to say that I like the post and totally agree!