12 May 2011

Senate committee divided over milk price war

12:57 pm on 12 May 2011

A Senate committee in Australia is divided over the effects of a milk price war in supermarklets there.

In an interim report, the Senate economics references committee says that as a general rule, lower milk prices at supermarkets are good for consumers, but it's waiting for more information to determine the full impact on dairy farmers.

The ABC reports that includes how long the campaign will continue, as well as the outcome of renegotiated contracts with milk processors.

But in a dissenting report, four Senators say there's evidence farm incomes are already being impacted, and they want an immediate interim floor price established for drinking milk supplies.

Liberal Senator Scott Ryan says there's no evidence farmers have suffered, but consumers have benefited.

The committee has harshly criticised the federal government for not acting on a similar report on dairy pricing from last year.