Fonterra must supply 'cheap' milk, regulator says

Friday 5th June 2009

Fonterra Cooperative Group must supply milk at cost to Kaimai Cheese Co. and Grate Kiwi Cheese Co. after the regulator rule they qualified as independent processors entitled to a share of so-called “statutory” milk.

The entitlement, for up to 50 million litres of milk apiece out of 600 million litres that Fonterra must make available as required, stems from the legislation that allowed the cooperative to be created from the merger of New Zealand’s biggest dairy companies without breaching antitrust rules.

“Fonterra has breached the regulations by not supplying Kaimai and Grate Kiwi with milk,” the Commerce Commission said in a statement. It ordered Fonterra to pay compensation for losses to Kaimai and Grate Kiwi may have incurred when they didn’t receive the milk.

Businesswire.co.nz

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