The explanation of declining producer share is more straightforward- processing, marketing and distribution costs, incurred in consuming countries(SA), have tended to increase over time while production costs at origin have declined.

Charles, you are talkin bulldust, production costs at origin(on farm) have increased enormously, just look at the recent maize, cottonseed,oilcake ets prices, must i continue. Die dae is verby dat melkkopers net by die boere kan vat as hulle boeke nie klop nie, hulle is te laks om aan die uitset(bemarking) kant te werk want dis baie lekker in die huidige "comfort zone", maw moenie op die oponente se tone trap nie dan kan ons nie surplus melk by hulle vir lae pryse koop nie.Almal weet die verwerkers skuif melk tussen mekaar rond, ten koste van boere.

Charles my friend, I think you are on an other plannet than us dairy farmers at the moment.

Anoniem: Word wakker. The South African dairy industry operates entirely according to free market principles while the major role players on the international market, namely the USA and EU member states financially support their dairy industries by way of direct and indirect subsidies. This means that our industry has to compete with imported dairy products of which the prices are low as a result of government intervention.

“Products will always flow from countries that are more competitive to countries that are less so and SA is not very competitive at the moment.” Dr Theo de Jager (Free trade in Africa bad news for local farmers By Lindi van Rooyen FW). A study done by the SA Institute for Race Relations (SAIRR) shows that between 2010 and 2011 agricultural imports grew by 30% while exports with only 10%.(Hostile policies eroding agriculture By Lindi van Rooyen FW)

Cooperative marketing has played a prominent part in the history of efforts to improve agricultural marketing. Many thousands of cooperative associations and thousands of farmer members have blazed the cooperative trail to better marketing or another trail to failure and disappointment. Many farmers who form or join cooperatives, however, expect much greater reductions in marketing costs than can be achieved by such means. With vague notions about “enormous wasts” in marketing, they believe that all that is necessary in order greatly to reduce marketing charges is to eliminate the middleman, by marketing through a cooperative. However, the middleman is not “eliminated” but merely replaced by the cooperative, which automatically assumes responsibility for all or most of the services and costs of the private agency. Moreover, the cooperative seldom carries the product more than one or two steps from producer to consumer and usually does not replace the retailers and wholesalers in the consuming markets, who account for most of the total marketing charge. It is quite unreasonable and futile, therefore, to expect cooperatives to reduce substantially the price spread between the producer and the consumer or to be able largely to increase returns to members as a result of reductions in marketing costs.

As julle die Hollander wil aanvat moet julle, julle navorsing maar goed doen. Hy praat feite.

You are right to say that competiveness is very low in RSA and one of the reasons is that the milk buyers/distributars dont compete enough for producers as they shift milk form each other when they need product or have to much. They will find that the situation is changing rapidly as more and more producers will by leaving the dairy industry and they will be competing for product soon.If the milk buyers think that they will import, they will have to remember that they have fixed costs of their factories to service. If they are more agresive in their marketing strategies they CAN pay the farmer more, secure procuct and put a smile on the sharholders faces. It is not as the farmer wants R6 or R8 per liter, we are only asking for a average of R4 to R4.50 per liter.But like DB to lower prices to R2.95 per liter and still keep their prices on the shelves the same, at the cost of their farmers. SHAME ON THEM.

The disadvantage of “free trade” is the extremely important role play by the government, to take steps to preserve food production capacity at home. Should a short term policy of “cheap imports” be followed to the detriment of the local farmer, South Africa, with time may be faced not with food security but “food insecurity”.