18 Feb 2009

Consumer body wants a drop in the price of cheese

9:58 am on 18 February 2009

Consumer New Zealand says the cost of cheese should reflect other price trends.

Months of falling dairy commodity prices have failed to lower the cost of products such as cheese.

In October, there were media reports that supermarket dairy prices were poised to drop because the global financial crisis was undermining international dairy returns.

The chief executive of Consumer New Zealand, Sue Chetwin, says dairy prices should reflect those trends.

"Fuel prices and world commodity prices have come down and you would think that would be reflected in the costs of cheese, butter and milk but, so far, it is not. And why they have not is a question that needs to be aimed at Fonterra and the supermarket chains," she said.

But the managing director of Fonterra, Peter McClure, said the company has absorbed the rising cost of raw materials.

He said Fonterra operates in a highly competitive market, which ultimately determines the price of its products.