The Australian Dairy Farmers (ADF) group and regional lobby organisation EastAusMilk have called for the ACCC to closely examine Coles’ acquisition of Saputo’s Melbourne and Sydney plants. The acquisition will make the retailer a milk processor.
ADF president Rick Gladigau said the consumer watchdog needs to closely examine the deal to ensure there would be no weakening of competition at the farmgate. While ADF’s president welcomes more competition in the sector, he said the deal could cost the dairy industry in the long-term if Coles were to have a “monopoly on the market”. EastAusMilk’s co-chief executive Eric Danzi said the deal will give the retailer complete control of the supply chain, giving them further power against other brands. Both plants were constructed by Murray Goulburn and acquired by Saputo in 2017. The plants have produced Coles own brand since opening in 2014. A Coles spokesperson said the retailer introduced a direct sourcing model for its own brand milk in 2019 to provide fair competitive and guaranteed farmgate prices to farmers directly, offering greater security for farmers in the long-term.