MG reviewing pricing policies

06 Mar, 2017 08:53 AM
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Ari Mervis is expected to meet with MG suppliers in coming weeks.
We are looking at all different options as to how best set a transparent and predictable price ...
Ari Mervis is expected to meet with MG suppliers in coming weeks.

Murray Goulburn was reviewing its pricing policies after a disastrous 12 months for the dairy giant, says new general manager Ari Mervis.

The co-op has taken a hammering, posting a $31.9 million loss in the first half of the financial year and a big drop in its milk intakes.

"We are looking at all different options as to how best set a transparent and predictable price for our supplier base, which is obviously what they are entitled to and what they expect, and what they need," Mr Mervis told the Border Mail.

"It is very much a work in progress."

Mr Mervis is expected to meet with MG suppliers, including a trip to the Tangambalanga factory in the North East, in coming weeks.

Murray Goulburn is under investigations by the Australian Securities Investments Commission over potential breaches of the Corporations Act as well as the Australian Competition and Consumer Commission over possible breaches of the Competition and Consumer Act.

ACCC chairman Rod Sims said after a public forum at Warrnambool, Vic, last week Murray Goulburn's price cuts and payment clawbacks last May had "blown up" the milk cooperative system.

He said the dairy processors' actions had imposed "all the risk" on their farmer suppliers.

"That is not an even system," Mr Sims said.

Mr Sims said the ACCC would also look at whether dairyfarmers needed a more transparent milk pricing system that would allow them to easily compare the prices being offered by processors.

Dairyfarmers have told the ACCC the complex payment structure by processors, and the little time they had to compare prices before the next milk season started, left them at a disadvantage.

Border Mail

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