Marktmacht und räumlicher Wettbewerb entlang der Wertschöpfungskette von Milch. Schriftenreihe der Bundesanstalt für Agrarwirtschaft Nr. 105

Tribl, Ch.Salhofer, K.


In recent years a possible market power of food retailers and of the food processing sector has repeatedly been addressed in the public discussion. This article presents the results of two studies which examine how food prices, particularly in the milk sector, are influenced by market power along the value chain.

The high concentration in food retailing facilitates the exercise of market power of retailers towards consumers and food processors. The empirical results for the Austrian food-retailing sector indicate that market power with respect to dairy products exists to some extent. However, this market power is product-specific and statistically more significant downstream than upstream.

The spatial dimension of the raw-milk market facilitates market power of milk processors towards farmers. This market is a "mixed market" in which processing cooperatives compete for raw milk alongside investor-owned processors. In accordance with the "yardstick of competition" hypothesis, theoretical results of the analysis of spatial competition among processors show that processing cooperatives can mitigate the market power of investor-owned firms