Coles in the clear in milk price wars

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The Australian Competition and Consumer Commission (ACCC) has announced that it does not believe that supermarket operator Coles broke any competition rules when it dropped the price of it’s house brand milk to AU$1 a litre

The decision came after Coles was taken to the commission on fears that the price reductions, which kick-started a price war with rival Woolworths, was engaging in predatory pricing which would affect dairy farmers.

The commission chairman Graeme Samuel said in the verdict that the most major impact from the reduction has been on the supermarket’s profits, but has benefited consumers who purchase house brand milk.

On the matter of dairy farmers and processors, Samuel said that evidence has shown that most milk processors pay the same farm gate price to dairy farmers irrespective of whether it is intended to be sold as branded or house brand milk.

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