freediver wrote on Sep 16
th, 2019 at 7:52pm:
Gnads wrote on Sep 16
th, 2019 at 10:37am:
freediver wrote on Sep 16
th, 2019 at 8:11am:
"Predatory pricing" is an emotive term with no real meaning. I am against anti-competitive behaviour, but I suspect that is not what you are on about.
There is no need to assume the farmer 'needs' to get more than the cost of production. You can safely assume that he is.
What? .... similar to AGW/Climate Change science?
As for safely assuming farmers are making more than cost of production .... why is it so many have left & are on the brink of leaving the industry?
No one leaves if they are making money.
The ones who left are the ones who did not think they were making enough money. They are no longer farmers. If they are still farmers, it is safe to assume they are making not just a profit, but enough to justify all the personal effort. It's a safe assumption because farmers are capable of acting in their own self interest.
Quote:I think the price paid to producers needs to be looked at because supermarkets use milk as a loss leader and producers get screwed to selling for a paper thin margin.
Totally irrelevant. If supermarkets sell it as a loss leader, they are the ones forgoing profit on milk.
If they failed to pay the farmers enough, they would have no milk to sell. Milk appears to have one of the narrowest profit margins (for the retailer) of any product on the shelf. They could double the price, but they would not have to pay the farmers a cent more. They would probably pay farmers less, because less milk would sell so they would be an oversupply at wholesale levels. Those loss leaders are actually helping farmers.
That's assumption on your part.
Cows have to be milked or their husbandry suffers... a farmer cannot withhold his milk if he doesn't the price he wants .... it's perishable & he has limited storage.
Milk is a high volume product & supermarkets are using it as an advertising ploy for "lower" prices.
They sell high volumes of a lower quality product with a smaller profit margin.............
and that is kicked down stairs to the supplier/processor & then the farmers.
They more than make up for the low price by increasing the costs over all the other products.
You still haven't explained why Coles, Woolies & Aldi have not passed on the 10 cents per litre increase on their $1 milk to the farmers as they advertised & promised.
Drinking silver con?