The price of milk

John Key says that New Zealanders are paying perfectly reasonable prices for milk. Sub text: so everyone, especially the opposition, should stop complaining because hey, it’s all okay here and we’re on the verge of something special or whatever.

In Countdown supermarkets this morning, housebrand milk was available for $3.99 for two litres, or $1.995/litre.

Countdown milk

Countdown milk

In Sainsbury’s in the UK this morning, housebrand milk was available for £1.50 for two litres, or £0.75/litre.  At present, that’s about $NZ 1.62 per litre.

Sainsbury's milk

Sainsbury’s milk

In Coles in Australia this morning, housebrand milk was available for $AUD 2.00 for two litres, or $AUD 1 for a litre, which at present is about $NZ 1.07/litre.

Coles milk

Coles milk

Yes, there are all sorts of pricing wars going on, and in Australia some supermarkets are using milk as a loss leader to draw people in. The point remains: in a country which is a prolific producer of dairy products, it is more expensive to buy milk than in is in other comparable countries.

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3 Responses to The price of milk

  1. Just to reiterate your point that, for example, in the UK a very competitive supermarket industry deals almost direct with the farmers and buys no far above their cost … so the solution here – for the customer – would be more competition, not regulating pricing in any way. And competition not just within the two supermarket chains, but away from the Fonterra single desk model.

  2. RossM says:

    It is more expensive to buy lots of things in NZ than overseas. We have an inefficient retail sector. That’s why so many people buy things like clothes, shoes, electronics and books via the internet.

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