May 22, 2008

US dairy cooperative denies involvement in milk price manipulation
 

Leading US dairy cooperative Dairy Farmers of America (DFA) denies any wrongdoing over suspicions that it may be involved in price fixing for some of its products.

A number of milk processors in the EU and the US are facing enquiries into their operations as milk prices have increased strongly over the past few years despite a high level of processor consolidation.

Rick Smith, president of DFA said the enquires are nothing new and the company is confident that it has done nothing wrong in regard to its pricing. However, he acknowledged that the company has a responsibility in ensuring its members the best possible value from their milk.

A number of investigations were launched last year due to allegations of price fixing in the dairy industry. In December 2007, Nestle and Vivartia were among the processors facing fines for supposedly fixing dairy prices in Greece.

The charges follow the findings of a year-long investigation that said some dairy groups had shared price information in the country and it occurred three months after it was revealed a similar enquiry had been made in the UK.

In the UK investigation, the Office of Fair Trading said supermarkets and dairy processors, including Dairy Crest, Tesco, Asda and Arla Foods had cheated about GBP 270 million (US$426 million) from consumers.

DFA is a dairy marketing cooperative that serves and is owned by more than 18,000 dairy farmers in 48 states. It is a processor of cheese and milk and food ingredient manufacturer.