Is this the end of $1 milk?

Canadian milk company, Saputo, last month announced that it would purchase Australian dairy co-op, Murray Goulburn, for $1.3 billion, which will make it Australia's largest dairy producer.

Saputo's boss, Lino Saputo, has indicated that, once existing contracts expire, we will see the end of $1 per litre supermarket milk.

“Through this process we will inherit all of the contracts that were signed by MG,” Mr Saputo told the ABC. “I don’t know the economics of it, to be quite frank with you, because we weren’t privy to those contracts for antitrust reasons.

“But we will honour the contracts. When those contracts expire we have to look at the economics of them and then from there we’ll see what we need to do moving forward. I don’t know the economics of dollar milk.

“We’ll have to take a look at that once we get involved in the business. The one thing I can say, though, is that when you look at other food products that are on the shelves, when you can get water at $3-a-litre and perhaps soda at $5-a-litre, for all the energy and effort that farmers are putting into producing milk, I’m not sure that it is the right value.”

Read more at www.news.com.au

Do you think this is good news or bad? 

11 comments

I have not been buying the $1 milk I want to suport our blokes --

 

 

It's crazy for Coles to be selling milk cheaper than bottled water with no regard for the dairy farmers, the whole idea was dumb and should never have started in the first place.  Very glad a Canadian company has taken over and not the Chinese.

 

My personal opinion this is bad news for poor families who depend on cheaply priced milk to nourish their children. I think free milk in schools should return.

To compare milk with bottled water makes no sense to me...since one can get perfectly good water from the tap in Australia....

Too right FLEUR, 

Good point Fleur - we need to keep the poor and needy in mind.

Hello Sen.Cit.88 and Troubadour...

I do feel for the dairy farmers..but sometimes we forget the really needy..two sides to a coin...

To be quite honest at the end of the day..when things get too tough for someone with a farm or else..they can sell up at a very good price..however..the poor usually have nothing to sell....

Saputo has not started well with his distortion of the facts.  Water can be purchased for as little as 40 cents for a litre, not $3.  Soft drink can be purchased for as little as 80 cents, not $5.

The part I agree on is that milk is too cheap.  On the farm gate end farmers are doing it really tough and the price needs to go up and the middleman's cut needs to go down so that farmers get enough money to pay their debts and put food on the table.

Oh yes, lovely Mick. I agree wholeheartedly with your thoughts on this subject. 

I wonder if this article could be combined with one earlier in the week which showed that pensioners, especially female pensioners, are doing it tough. The $1.00/litre milk suits those who are on low incomes and leaves the more expensive milk for those who believe that the dearer milk is more benefical. To those who want to support the dairy industry by not buying $1.00/litre milk, all power to you but I'm betting that Saputo won't increase the farmgate price when they increase the retail prices.

What will Saputo do if they find that the cheaper milk is uneconomical? Will they look at the margins on the dearer milk and adjust the prices down to give an overall margin comparable to the current margin? I doubt that. Does Saputo really want us to believe that their due diligence excluded the deal on $1.00/litre milk? This announcement is merely to soften us up for the inevitable price increase when the current agreement ends.

i have never bought the cheaper milk,    as i try to buy OCEAN GROVE milk,    as it is local,       but i can understand families with 3/4 children who rely on the cheaper brands,     trying to buy milk for 3/4 kids breakfasts would take a carton on iys own,       free milk should be brought back into the schools,      when i was at primary school in LONDON,   we got a spoonful of malt as well,     i can taste it now,    was lovely,   

The environmental cost of dairy isn't factored in to the price - the bodily waste, the high water usage, the cost of disposal of plastic containers, nor the cruelty cost of taking new born babies away from their mothers, some for a lonely short life to become veal and others to an abattoir without food or water or knocked on the head at the farm (legal in Qld).  Such a cruel industry is totally unnecessary when there are so many plant based alternatives that are delicious and better for you and the environment.  See ditchdairy.com.au for last week's Qld expose.  

Agree - soy milk is delicious an alternative for the lactose intolerant 

go Veg you are so darn right -- the way Animals are treated for humans use is horrific

go Veg,

Unfortunately, animal cruelty is the unseen factor  in so many industries ... not the least the meat/milk industry.

I would imagine butter, yoghurt,cheese and anything made with dairy will all increase in price as well.

Soy critics argue that soy contains phytoestrogens, which are thought to be unsuitable for young children. Cow’s milk, on the other hand, has more calcium than natural soy. Cow’s milk also contains more vitamins, such as vitamin B12 and vitamin D, all good for a child’s development.

I do think children should be given free milk.

Bijou,

I think you might be correct about soy milk ... however, calcium B12 and D and other vitamins can be obtained from other foods.

Some people either don't like milk or are vegans, so don't drink cows milk at all.

We should have a better educated society.

From my memory of free milk at school ... the crates we left in the sun, consenquently ...  But undoubtedly, this problem was not in every school.

Bijou -  I was the only one in my family that was raised on Goat's milk, my other two sisters were raised on cow's milk. I was the healthiest of the three of us and had the better skin and teeth. No pastuerised milk in those days, warm and straight out of the udders. 

Would be extremely silly to bring in the milk for schools program in this day and age

Would be a massive waste of taxpayer money

Even the greens wouldnt be that stupid

Ignore the two headed duck Bijou, my Princess. One head quacks while the other head barks. Hilarious.

Image result for two headed duck

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