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Valio hit with €70m fine in Finland

By Jim Cornall+

11-Jan-2017

Valio said it is disappointed by a €70m fine, but considers the case closed.
Valio said it is disappointed by a €70m fine, but considers the case closed.

In December, the Supreme Administrative Court of Finland (KHO) fined Valio €70m ($74m) for abusing its dominant market position by selling basic milk at too low a price from 2010-2012 in Finland.

Vesa Kaunisto, chairman of Valio’s board of directors, said the sanction will not affect the price paid for raw milk to the dairy farmer entrepreneurs.

The decision means Valio’s competitors will have the opportunity to claim damages in the District Court of Helsinki, with Valio stating that the process could take several years.

“Valio’s strong equity position and cash assets will serve as a buffer. We’ll have to consider the next 10 years investment programs in Finland,” Kaunisto said.

The price Valio pays for raw milk is affected by the success of the company’s consumer products in Finland, Sweden, and other markets, the global price levels for industrial products (milk powder, and butter sold to the food industry), and the cost-efficiency of Valio’s operations.

Valio CEO Annikka Hurme said that the company was disappointed at the decision, but the case is now closed.

“Valio has moved on and we will focus on our strengths: Processing dairy products responsibly and developing world class innovations such as Valio ValSa milk salt and developing and selling attractive consumer products such as tasty, low sugar snacks and protein products that benefit health in Finland and on international markets,” Hurme said.

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