“This is a story with a bad sour odour, for both the farmer and the consumer,” says Vandamme in the trade magazine VILT. ABS shows with photos that a liter pack of semi-skimmed long-life milk (UHT) is for sale at Albert Heijn in Belgium. for €0.49. The same semi-skimmed UHT milk costs 40 cents more at Albert Heijn in the Netherlands. “No sensible person can explain to us how that price difference can be justified,” says Vandamme. Skimmed milk is on offer at the same AH in Belgium for €0.32 per liter (an “outrageously low price”, still below cost), normally €0.49.
According to ABS, the milk price in the store must be at least €0.70 to €0.80 if the dairy farmer is to be able to cover the costs. “It is sour for the farmer and the dairy that are squeezed like lemons to keep the profit margins of the retailers high. But also for the consumer, who does not get what he thinks he pays for.” Vandamme calls on consumers to stop taking ‘this prize game’, in which the cheapest bottle of water in the supermarket is even cheaper than the milk.
ABS and the member dairy farmers call the developments ‘unacceptable’. Several farmers would be ready to go to Belgian AH stores with their tractors, VILT writes. Not only to express their displeasure, but also to make consumers aware of what is going on. “The low prices cannot be justified, it seems that food is worth nothing,” says Vandamme. It is not yet known when and where the actions would take place. Walloon dairy farmers may also want to join because they are angry about the cheap milk in the store.
5 instead of 2 cents more and ‘loss leader’ lures
It is striking that Albert Heijn in the Netherlands has an excellent relationship with its suppliers for fresh milk. The ‘Better for cow, nature and farmer’ program pays the participating farmers a plus of 5 cents on the milk price, far above the additional price of 2 cents that farmers’ cooperative FrieslandCampina pays its farmers for PlanetProof milk. Last spring, AH expanded with 150 extra farmers to make even the cheap private label ‘Beter voor …’ better paid for it.
Farmers and consumers generally do not understand that the selling price of products is separate from the purchase price, because supermarkets calculate their margin on the total basket we buy from them. Low prices for certain products only act as a lure to attract us to their store. It’s not for nothing that such products are called loss leaders. Of course, this does not automatically mean that supermarkets pay the main price for the purchase of such products.