Dominant dairy draws more flak

Several grocery store owners claim Norway’s dairy conglomerate Tine, which regulates and controls the national market, still isn’t managing to produce enough butter to meet demand. Meanwhile, Tine’s role as market regulator remains under fire, food prices have been confirmed as the highest in Europe, and now the dairy has even landed in trouble over a controversial promotion.

Tine, Norway’s dominant dairy cooperative and market regulator, is in trouble again on several fronts. PHOTO: newsinenglish.no

Newspaper Aftenposten reported Wednesday that supplies of butter on grocery store shelves, especially in Oslo, aren’t lasting until the next delivery. Both the NorgesGruppen chain, which owns Kiwi, Spar, Meny, Joker and Ultra stores among others, report they’ve run empty for butter during the run-up to the Christmas holidays.

One Kiwi store in Oslo’s St Hanshaugen neighbourhood resorted to posting notices to customers, apologizing for the new butter shortage and placing the blame squarely on Tine. Kine Søyland of Norges Gruppen told Aftenposten that Tine’s attempts to ward off another critical shortage of butter like the one that hit Norway last year, by arranging for special imports of French butter, aren’t working. NorgesGruppen’s stores are only getting 60 percent of the butter they ordered.

Tine refutes that, claiming there is enough butter on the market. Tine spokesman Lars Galtung admitted that not all stores are getting all the butter they ordered, but that Tine is delivering more butter this December than it did in December 2010, before the butter shortage hit last year and grabbed headlines for months.

Butter supplies have been running low, or running out, at some grocery stores again. Prices are also up. PHOTO: newsinenglish.no

Arguments have broken out, meanwhile, over how Tine executes its role as so-called “market regulator” for dairy products in Norway and how that affects the prices consumers must pay in the country. A recent study by European statistics bureau Eurostat and Sweden’s central statistics agency confirmed what’s long been known, that Norway has Europe’s highest food prices. The latest figures show they lie 64 percent over the European average.

The employers’ organization representing food and beverage businesses, NHO Mat og Drikke, claims Tine, which controls 80 percent of the market for dairy products in Norway, blends its roles as market regulator and commercial operator. The organization thinks Tine should be excluded from auctions at which toll-free import quotas for items like butter are decided, because it can bid high and then boost prices to cover the cost. “The consequence for Norwegian consumers is more expensive products and poorer selection in the stores,” Dag Kjetil Øyna of NHO Mat og Drikke, told Aftenposten earlier this month.

NHO members on the farming and production side of the organization, however, whom Tine effectively protects under Norway’s highly regulated agricultural industry, want Tine to continue to play a decisive role in imports, not least of butter. The argument has left NHO itself in an awkward position, trying to reconcile the interests of non-dominant industry players with those accustomed to protection from more liberal and foreign competition.

Food producers in Norway continue to claim that high and rising income levels mean most Norwegians can afford the country’s high food prices. The prices continue to aggravate many consumers, however, and Tine also got in trouble this week over a TV commercial it was running to promote its kulturmjølk, a sour milk billed as part of the national heritage.

The problem was that the commercial featured, among others, Jan Høeg, an 89-year-old opponent of immigration who remains deputy leader and spokesman for an anti-immigration group known for controversial slogans as “En neger kan aldri bli nordmann” (literally, “A Negro can never become a Norwegian”) and that Norway’s monarchy should remain focused on Norway and not be influenced by immigrants from Pakistan.

Tine apologized that Høeg was featured in its promotion and pulled the commercial from TV screens.

Views and News from Norway/Nina Berglund

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