A successful prosecution of three Irish dairies and two supermarkets for alleged breaches of the Competition Act 1991 could result in cheaper milk for consumers. The Competition Authority has instituted court proceedings against Glanbia, Dairygold and NCF dairies and Tesco and Superquinn following an investigation into the milk trade at the end of last year.
While the authority would not comment on the cases, it was learned that should they be successful, the prices being charged for milk to the consumer may be reduced.
Meanwhile, the authority yesterday warned the Irish Farmers' Association that Aldi, the German supermarket chain, was free to sell milk at whatever price it liked as long as the chain adhered to the provisions of the Groceries Order.
An authority spokesman said yesterday the director of consumer affairs had established that selling milk imported from Northern Ireland at between 89p and 99p for two litres does not constitute below-cost selling.
The spokesman, Mr Pat Massey, confirmed that the authority had written to the IFA seeking a meeting over reports that it had approached the supermarket about the price at which it was selling milk.
The meeting, he said, was to clarify the position under the Competitions Act and its position was that Aldi was free to sell milk at whatever price it liked once it adhered to the provisions of the Groceries Order.
"They are equally free to buy milk from whatever source they choose and, presumably, they buy from whoever gives them the best deal, which they in turn pass on to the consumer."
He said the authority believed that any attempt by any association to interfere with the retailer's right to set its own price, and to seek to raise that price, would be in breach of the Competition Act.
He said the price of milk in most shops in the Republic was considerably higher than in Northern Ireland, although the authority understood that prices paid to farmers were similar.
He said a family buying 10 litres of milk a week at 89p per two-litre carton could save as much as £2 a week on prices in other stores.
The IFA said last night it was studying the authority's letter and would be replying as soon as possible.