Coles has been accused of short-changing dairies with its cartons of Farmers‘ Fund milk, but the supermarket giant says leftover money is still directed to farmers.
The Farmers‘ Fund milk costs 50c more than 2L of standard Coles cartons, but labels stipulate only 40c goes towards supporting dairy farmers.
A photo of the labels was posted to social media site Reddit on Saturday, and customers speculated the leftover 10c was pocketed by the supermarket.
But a spokesperson told Daily Mail Australia the 10c is passed onto the Victorian Farmer‘s Federation for promotion and administration.
Coles announced in May 2016 the Farmers‘ Fund Milk would be exclusively sold in Victoria stores, to provide customers with a choice to help dairy farmers.
The Farmer‘s Fund Milk costs an extra 50c, making 2L bottles $2.50 instead of $2.00.
Coles has continued to sell the cheaper milk, leaving it up to customers to decide whether or not to buy from the more expensive range.
While a label on the shelves in the supermarket explains that 40c from the extra 50c goes directly to farmers, customers questioned where the extra 10c went.
One person speculated the money went to the Coles marketing department.
Another accused Coles of ‘creating the problem and then selling the solution‘.
But a Coles spokesperson said: ‘An extra 10 cents from every two litre bottle sold is directed to the Victorian Farmer‘s Federation for promotion and administration.
‘Any unused funds left over from this 10 cents are directed into the pool for distribution to dairy farmers.
In a statement Coles said the 40c from the Farmer‘s Fund milk given directly to the dairy farmers fund was over and above the price paid to farmers for their milk.
Farmers’ Fund Milk is owned by the Victorian Farmers Federation and produced under license by Murray Goulburn and Coles.
THE MILK PRICE WAR
Murray Goulburn co-operative was formed in 1950 and is Australia’s biggest dairy producer with 2600 dairy farmers
NZ-based Fonterra was founded in 2001 and is the world’s largest dairy exporter and has 1200 Australian dairy farmers
April 27 Murray Goulburn (MG) downgrades profit forecast $39-42million down from $63m in February
MG price for milk solids cut from $5.60 a kilogram to $4.75-$5 after overestimating value. The lower price is backdated to 2015 meaning farmers had to pay back the overpayments
MG listed units price crashes from $2.14 to $1.24.
May 5 Fonterra also slashes gate prices from $5.60 per kg to $5
May 16 Class action launched against Murray Goulburn alleging investors were misled
Lobby group Farmer Power calls for 50 cent dairy levy to be passed onto farmers
May 17 Fonterra announces partial about-face with plans to increase payments for milk supplied in May/June
MG unit price falls again to historic low of 85 cents