Fourteen dairy companies have supposedly made arrangements to divide the Romanian market among them. One of the parties involved is French dairy giant Danone.
Three international giants involved
The Competition Council, the Romanian government body tasked with ensuring a normal competitive environment, has started an investigation into the possible market manipulation. Apparently there were arrangements about how to collect, to process and to market milk.
Aside from three large foreign groups (Danone, FrieslandCampina and Hochwald), the following holdings are also being investigated: Albalact, Covalact, Almera International, Dorna Lactate, Lactate Natura, Napolact, Lactag, Lacto-Solomonescu, Teletext, Unicarm and Unilact Transilvania.
If the dairy companies are found guilty, they can get a fine of up to ten percent of their turnover. The value of the dairy market in Romania is estimated at about 800 million euro.
The Romanian market is still very fragmented, especially concerning suppliers. In total, there are some 800,000 cattle farmers, with most having no more than five cows.
The carcinogenic aflatoxin, found in locally produced milk, rocked the Romanian dairy market at the beginning of 2013. Dairy cows being fed polluted corn turned out to be the cause of the issue.