Notice of Inquiry into the Australian dairy industry.

On 27 October 2016 the Treasurer, the Hon Scott Morrison MP, issued a notice requiring the Australian Competition and Consumer Commission (ACCC) to hold an Inquiry into the competitiveness of prices, trading practices and the supply chain in the Australian dairy industry.

Matters to be taken into consideration in the Inquiry shall include, but not be restricted to:

• the nature of competition between processors for both the acquisition of raw milk and the supply of processed milk and dairy products
• the nature of retail pricing arrangements for milk and dairy products, and their impact up the supply chain
• the effect (direct or indirect) of domestic retail and export prices, and level of domestic and overseas demand, for Australian processed milk and dairy products on dairy producers and processors
• the nature of the commercial relationships between dairy producers and acquirers of raw milk and the impact of corporate structures adopted (including cooperative structures) upon those relationships
• the mechanisms used by acquirers of raw milk to determine prices paid when acquiring raw milk and the transparency of those mechanisms
• the availability, transparency and accessibility of market price information, and its effectiveness for forecasting movements in farm gate milk prices
• the terms on which raw milk is acquired from dairy producers and the means by which such terms are agreed
• the allocation of commercial risk across the dairy supply chain
• the role of collective bargaining in the dairy industry and its effectiveness
• the existence of, or potential for, anti-competitive conduct and the possible impacts of any such conduct on businesses within the dairy supply chain
• any other factors affecting farm profitability.

Conduct of the Inquiry

The Inquiry commenced on 1 November 2016.

This is not an Inquiry in relation to any particular person or persons.

The ACCC must submit its report following the Inquiry to the Treasurer before                                               1 November 2017.

Further information about the Inquiry, including the ACCC’s Issues Paper can be found on the ACCC’s website (www.accc.gov.au).

The ACCC invites written submissions on matters identified in the Issues Paper and other issues relevant to this Inquiry.  The Issues Paper explains how submissions should be provided to the Inquiry.