The Australian Competition and Consumer Commission has decided to allow seven dairy farmers from Manning Valley in New South Wales to collectively bargain with Woolworths and Milk2Market for three years.

“Collective bargaining arrangements can result in public benefits through transaction cost savings, providing participants with better access to market information and by allowing small businesses to have greater input into contractual terms and conditions, leading to more efficient outcomes,” ACCC chairman Rod Sims said.

The ACCC notes that any impact on competition will be limited as participation in the arrangement is voluntary for the dairy farmers, Woolworths and Milk2Market. Additionally, the volume of milk to be supplied is relatively small compared to the total volume produced in the surrounding mid-coast region of New South Wales.

“The collective bargaining notification regime was introduced to make it easier and faster for small businesses to collectively bargain with other businesses.  The ACCC has consulted with several interested parties and has made a decision about this matter in less than four weeks,” Sim said.

This is the latest dairy farmer, supermarket case following Coles and Devondale signing an exclusive 10 year milk deal.