Arla Foods: UK's top dairy

tiredoldbroker
You make a lot of pertinent points and I for one wouldnt challenge your accounting......
I would emphasise however that as a supplier of a basic commodity and UK market leader at that Arla could be viewed as a relatively low risk co in a low risk sector of the economy........This ought to attract a small sp premium
Also
........ as a prospective coop business it potentially offers a trustworthy home for farmers seeking long term deals for their products
and
........with the capability to integrate price sensitivity models which link the cost of production and the selling price to supermarket chains........coupled with its external resources
arla is thus well placed to be one of the two suppliers who eventually survive from the 3 suppliers at present
and make no mistake
when milk is supplied by two and not 3 suppliers the balance of power shifts across the table from the buyer to the seller....
.....since it is possible to maintain an informal minimum price agreement with two parties that is too risky with 3 parties..
.........leading eventually to a relatively cosy market with higher milk prices all round and little or no price competition on this commodity between the supermarkets