Lactalis has been accused of “unfair” trading practices in milk procurement by Italy’s principal farmers’ association.

Coldiretti, the body representing Italy’s agricultural industry members and farmers, is taking the French dairy giant to task over what it claims are 16 “unfair practices”, the association said in a statement.

Lactalis is being reported to the Central Inspectorate of Quality Protection and Fraud Repression (Icqrf), part of Italy’s Ministry of Agriculture, for the “violation” of milk-supply contracts. Rome-based Icqrf is an organisation dedicated to the protection of consumers and producers from unfair competition under European Union laws.

In the violation claims supported by Coldiretti president Ettore Prandini, Lactalis is accused of lowering contracted prices of milk to the detriment of farmers.

Lactalis responded today (21 July), via a spokesperson, claiming the charges against the company were “unjust”, adding it has contracts with about 2,000 farmers in Italy with “whom we have built long-lasting ties”.

However, Coldiretti said: “Lactalis unilaterally modified the contract with the milk supplying farmers by decreasing the recognised prices and introducing, among other things, a new index connected among other things to the non-agreed prices of European milk.”

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By GlobalData

The trade body’s claims on Lactalis also relate to late milk payments and below-cost prices paid to suppliers.

Lactalis added: “We believe that there is a need to restore the competitiveness of [the] Italian milk price, which is crucial for international trade, where we are still very penalised.

“We are already willing to engage in some peaceful discussions with the highest institutional and ministerial or regional authorities to contribute to the growth and development of the dairy industry, which we passionately share with our employees.”

The privately-owned French major has increased its presence in Italy through acquisitions and, according to Coldiretti, controls around one-third of the country’s dairy market.

It bought Invernizzi in 2003, Galbani in 2016, took almost full control of Parmalat in 2018 and acquired Nuova Castelli in 2019. Lactalis also owns the Locatelli and Cadermartori brands.

Lactalis has been in hot water before, most recently in Australia. A court ruled against the company in 2022 in a case brought by Australia’s competition authority for breaches of the country’s dairy code of conduct, including the early termination of agreements.

In 2021, Lactalis also fell foul of safety rules and environmental governance in its home market of France.

Lactalis said in today’s statement: “We have always listened to the needs of the agricultural world, that is why the relationship is so strong. The strength of our connection with the agricultural field is possible because we have always fully respected legal obligations and encouraged dialogue and communication.”