The government has announced in the Hurdal platform that it will phase out the competition-promoting measures in the dairy sector. The Norwegian Competition Authority warns against this. – We believe that competition in the dairy sector is weak and that it should be strengthened. And then we think it is absolutely wrong to remove the competition-promoting measures, says deputy head of the department for food, trade and health in the Norwegian Competition Authority, Magnus Friis Reitan 74 per cent market share The measures, in short, are about supporting smaller players to be able to compete with Tine, which has a milk market share of 74 per cent. The measures are evaluated every five years. According to a report from the Directorate of Agriculture, the measures have helped the competition. – The Norwegian Competition Authority is normally skeptical of subsidy schemes, but in this market there is a clear need for measures that can strengthen competition. We therefore recommend the continuation of the competition-promoting measures, says competition director Tina Søreide in a press release. She says the dairy market is a large and important market for Norwegian consumers. Despite 20 years of support, competition in the market is considered fragile by the Norwegian Competition Authority. – High market concentration, Tine’s strong position and high barriers to entry indicate that competition in the dairy markets is still weak. In order to maintain the competition for cheese and milk in Norway, this general subsidy should not only be kept, we should also consider increasing it, says Friis Reitan. ASSESSES: Minister of Agriculture and Food Sandra Borch visiting farmers in Vestfold May 2022. Photo: JOHN-ANDRE SAMUELSEN / JOHN-ANDRE SAMUELSEN Borch will assess the measures The government will gradually phase out the competition policy instruments from the scheme, confirmed Agriculture and Food Minister Sandra Borch in the Storting recently. – The government has not said that all the measures should be phased out at once, but we must look at the individual elements that the Directorate of Agriculture has included in the report, said Borch, according to E24. The right-wing parliamentary representative Lene Westgaard-Halle said in the same debate that she was concerned about increased prices. Tine thinks that is not true, and says they want competition on equal terms. – If the authorities want milk production throughout the country – and a vibrant Norway, then our competitors cannot continue to receive centralizing special subsidies of NOK 200 million a year, writes communications director at Tine, Ingrid Wilberg Arnesen, in an email to news. Hope the food minister follows up. She believes the other milk producers have some clear competitive advantages. – Today, our competitors can order the milk they want from us, without raw material risk – and at the same price as us. Together with the special subsidies, this gives them a clear competitive advantage. What does Tine hope the Minister of Agriculture and Food will do? – We have confidence that the government will follow up on the Hurdal platform and remove these special subsidies, so that we and our competitors can challenge each other on innovation and diversity for the consumer – on equal terms. May be affected A possible removal of the measures will be bad news for the Q dairies, Synnøve Finden and Røros dairies. Aksel Mjøs is head of the department of finance at the Norwegian Business School. He is also chairman of the Kavlifondet (non-profit foundation), which owns the Q dairies. He says that the current subsidy schemes are absolutely necessary to maintain competition. – The clearest signal that it is demanding to be a challenger in this market is that there are no newcomers who have invested heavily in the last 15 years, says Mjøs. news has not been able to get a comment from Agriculture and Food Minister Sandra Borch.
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The Norwegian Competition Authority warns against cutting milk subsidies – news Norway – Overview of news from various parts of the country
