The Competition Commission (CC) has released a report in which it has investigated conditions within the UK's £120bn supermarket sector. In the report, the CC states that it wants to further examine competition between retailers at a local level. This will involve looking at consumer choice within particular areas and how competition exists between different sized retailers. The CC is keen to point out that it does not intend, "...to punish success or individual retailers but we are concerned with whether Tesco, or any other supermarket, can get into such a strong position, either nationally or locally, that no other retailer can compete effectively."

Of interest to milk producers will be the focus which has been given to the supply chain. In the main report - Emerging Thinking, the CC examines UK dairying and comments on aspects such as farmer numbers, income and the experiences of processors. It also comments on recent movements in retail prices saying, "The benefit of increases in the retail price of milk since 1999 have generally been retained by grocery retailers, increasing their share of milk revenues compared with dairy farmers and processors, and we are concerned to understand why this has been the case".

In Context

This report has identified further areas for investigation with regards to the relationship between suppliers and buyers. What is important now is for the affected parties to put together detailed examples of unfair treatment as the Competition Commission has stated that it has not received as much detailed evidence as it had expected. To view the full report, please click here.