Tine, Norway's dominant dairy group, told German discount grocery chain Lidl that they will only supply milk and dairy products sold in Tine's own cartons. Lidl has few viable options in Norway due to the country's protectionist duties.

Jostein Frøyland, Tine board chairman, told newspaper Nationen that meetings with Lidl collapsed because of the German chain's insistence on selling products packaged under their brand name.

Frøyland also divulged that Lidl representatives indicated that they were not ready to start their own dairy production in Norway, a shift from earlier interest in buying smaller Norwegian dairies.

Norway's other relatively large dairies, Synnove Finden and the Q-dairies, told the newspaper they had not been in contact with Lidl.

Lidl has been able to solve this problem in other countries by importing milk from Germany, but this is unlikely to be cost-effective in Norway.

"Lidl's main concept of buying their goods abroad can hardly be achieved. The reason is the high protective duties Norwegian agricultural products have. For example, it would be unusually expensive to bring German milk to Norway due to the protective duties on Norwegian milk," said Leif Forsell at the NILF (Norwegian Agricultural Economics Research Institute).