Consumers punish dairy ‘regulator’

Norwegian consumers clearly haven’t forgotten last winter’s nationwide butter shortage, blamed on dairy cooperative Tine’s failure to head it off. Now Tine, also known as the “market regulator” for dairy products in Norway, has lost consumer confidence, reported poorer financial results and must once again import French butter.

Tine is still having trouble keeping butter on the shelves, and has arranged to import French butter made after Tine's own recipe. PHOTO: Views and News

An annual ranking of Norway’s best-liked companies, conducted by analysis firm Ipsos MMI (formerly Synovate), shows that Tine has tumbled from fourth place last year to 14th place this year. It once ranked as among the companies that was most-liked, but hasn’t even made it into the Top 10 of the new survey. Now, reports newspaper Aftenposten, the Swedish home furnishings giant Ikea holds the top spot, followed by grocery story chain Coop Norge and Norwegian Broadcasting (NRK).

Even though Tine continues to wield enormous power, controlling 80 percent of the dairy products market in Norway, it must still care about its reputation, marketing professr Tor W Andreassen at Norwegian Business School BI told Aftenposten. “Because of its monopoly, Tine doesn’t fear losing customers but rather disappointing the authorities,” Andreasen said. “When its reputation falls and consumers complain, the politicians must react. That can lead to changes in Tine’s mandate and they’re afraid of that.”

Tine continues to have trouble meeting demand for butter and, most recently, various brands of yoghurt. It’s been ridiculed in the media, chided by dairy farmers who claim it hasn’t raised production quotas quickly enough and appeared to behave arrogantly when the butter shortages first began. Now Tine officials claim they’re working hard to win back consumer confidence.

The fall in the Ipsos MMI rankings was, admitted Tine’s communications director, “a well-deserved smack” from consumers. “We aren’t surprised that Norwegian consumers are disappointed over the butter shortage last year,” Lars Galtung of Tine told Aftenposten. Now he says Tine not only has arranged for butter imports to offset another looming shortage, but he claims Tine has struck an agreement with a French importer to make butter according to Tine’s own recipe. “It will be better-suited to Norwegian taste and usage,” he said.

Financial results, meanwhile, have been hit by the costs of investment in new facilities in addition to lower sales. Even sales of its Diplom ice cream declined this summer, which was cold and rainy. “Good ice creams sales are tied to good weather,” Galtung said.

Tine’s absentee chief executive Hanne Refsholt, who’s been off on a controversial year of fully paid study leave and therefore wasn’t at work when last winter’s butter crisis hit, was expected to be back next week.

Views and News from Norway/Nina Berglund

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  • Comment_approved

    but he claims Tine has struck an agreement with a French importer to
    make butter according to Tine’s own recipe. “It will be better-suited to
    Norwegian taste and usage,” he said.

    Yeah – great big ploy because they are worried consumers will actually like the superior foreign butter and demand the right to choose in the future.

  • Comment_approved

    but he claims Tine has struck an agreement with a French importer to
    make butter according to Tine’s own recipe. “It will be better-suited to
    Norwegian taste and usage,” he said.

    Yeah – great big ploy because they are worried consumers will actually like the superior foreign butter and demand the right to choose in the future.

    • http://profiles.google.com/kiwi.robbie Robert Cumming

      who needs the right to choose when the govt can do it for us….?

  • the sage

    I recently had a discussion with a couple of friends regarding the butter shortage last year and the reasons that Tine had publicly stated were “natural” causes due to weather, grazing and milk production from the animals. Surely these can be factors removed from their direct control.

    But these friends have informed me that another reason for the butter shortage was that Tina had found a foreign buyer for their butter that would fetch them a higher price than if it had been sold in Norway. And that they made this move despite how it may affect supplies at the height of the holiday season. And that this is not known to many.
    I have found nothing to verify this on the internet and it does not seem to quite make sense when one asks where in the world could TIne actually fetch a higher price than expensive Norway for their butter.

    It would seem obvious that the holiday season butter shortage would affect commercial bakers and preparers of foods during that crucial time.
    But it would also be my hope that individuals have not lost or abandoned the tradition of making your own butter from cream, which seemed to not have disappeared from the shelves or need to be imported at that time.

    And it would seem to me that a butter shortage due to purely natural causes would have resulted in a cream shortage or spike in prices as well due to limited supply. But it did appear that cream was abundant. The butter from Brussels and Ireland did not taste as good as Norwegian butter…so I made my own from cream until supplies resumed.

    • http://profiles.google.com/kiwi.robbie Robert Cumming

      Personally I thought the foreign butter tasted better, but what was even more ridicilous is that Tine could have produced more butter but due to the quota system Norwegian farmers couldn’t sell them all the milk they produce; weather and conditions was just an excuse, fyi the vast majority of Norwegian dairy cows live inside. Norwegian farmers dumps millions of litres of milk every year because they produce more then they have a quota for.

  • aquacalc

    “Tine’s absentee chief executive Hanne Refsholt, who’s been off on a controversial year of fully paid study leave and therefore wasn’t at work when last winter’s butter crisis hit, was expected to be back next week.”

    That statement, which speaks volumes about the management’s sense of responsibility, bears repeating.