September 28, 2022

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Incomprehensible logic from Q Dairies – The Nation

On August 3, the Q-dairies CEO reported a worse 2021 result than the previous year. Not unlike what TINE itself reported last year. This will be reinforced in 2022, as the impact of the pandemic, which has given everyone in our industry a temporary increase in sales, is over.

Movement in the community returned, cross-border trade reached new heights and costs increased dramatically. TINE’s operating profit for the first period of the year was NOK 164 million lower than it was in 2021, largely due to this.

Christine Achim blames much of the 84 million drop on the distributive grant decision as of November 2021. It is in itself a difficult calculation to perform for the following reasons:

Q’s dairies received about NOK 50 million in distribution support annually. There will be more than 8 million in November and December. But:

Two weeks after the decision of the Directorate of Agriculture, the Minister of Agriculture decided to continue to pay the subsidy pending the complaint from Alban Q.

This should be seen for what it is: Q dairies use a year requirement and score and blame TINE, the state and a distributive grant decision they no longer meet the criteria for obtaining, rather than explaining the state of things as they are.

Since thousands of words have been written in this newspaper, we know it takes a new factory, as we did too. Especially during an epidemic. It is therefore not surprising that the significant investment and new facility entails increased challenges and costs during the start-up period.

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But this is not a good enough reason for Norwegian consumers to keep paying fees to fund subsidies for large and powerful companies by supporting competition policy.

It’s not just Q and TINE dairies that are seeing increased costs. The farmer does the same to a very high degree, feeling the rising costs on his body every day. If Q and Aasheim are serious about wanting to sell more milk in this country, not less, they should also consider that it is right and important that the country’s dairy farmers get higher and badly needed returns so there are still producers who can guarantee the best milk In the world, not the unfortunate cause of a worse outcome.

All players in the dairy market, but also in the food industry, see difficult times ahead. But it’s worth noting that Q’s dairies are better equipped than most to cope this time around, without all of Norway’s milk customers having to foot the bill for it.

Q Dairy now has the largest, most modern and efficient dairy in the country for fresh produce in the country’s most milk-rich region. With the advantages of large scale that TINE facilities cannot match. We source milk from producers across the country.

Q TINE’s dairies describe them as “super dominant,” while they have a market share of 40 to 60 percent of drinking white milk in the country’s most populous areas, which are also not far from production.

Finally: Achim accuses TINE of being able to magically dictate the terms of the competitors’ framework and goes so far as to propose a conspiratorial collaboration with the Department of Agriculture, which we vehemently reject. There are grave, untrue and baseless accusations being leveled at the ever-increasing expense of Ashim himself.