May 17, 2010

A senate inquiry into Australia's dairy industry has called for reforms to the Trades Practices Act to stop farmers being squeezed by global business monopolies.

A senate economics committee report said it was clear major supermarket chains were ''making far more profit'' from the sale of milk to consumers than the farmers producing it.

The report said there has been a trend towards increased concentration of market power among multinational milk processors and big supermarket chains in Australia.

''The victims of this concentration are the farmers and the consumers,'' the report said.

''It seems clear that the farmers' profits from sales of drinking milk are much smaller than those accruing to the supermarkets and the milk processors. This does not seem a fair reflection of the effort required and risks undertaken by the various parties involved in producing the milk which consumers buy at a supermarket,'' it said.

The report said that over the past decade, Australia's dairy industry had moved from a position where most processors were local dairy farmers cooperatives set up to act in the interests of farmers to a situation where most processors are subsidiaries of foreign corporations.