Saturday, May 28, 2011

carbon taxes & dairy flatulence

How much carbon in my milk? Well, not actually in the milk, so to speak, but according to evil foreign New Zealand dairy multi-national Fonterra there is about 1kg of CO2 equivalent emissions in every litre of milk. This mostly comes as methane from the cows.

Carbon E. Coyote at Macrobusiness points out that "if all emissions were taxed, or charged, and the carbon price was $20/t CO2e, that’s 2c per litre of milk, or 4 cents per 2 litre bottle. That’s right 4 cents. Meaningless in the scheme of things, especially in the context of the recent dairy wars that have seen milk shelf prices drop substantially."  However, even such agricultural emissions are currently ruled out for later review under the proposed carbon tax.

The controversial milk price war started by Coles has produced almost as much flatulence from the dairy farmers as their cows. This flatulence drew some responses, particularly from Stephen King of Monash, and previously with the ACCC, at Core Economics. King points out that the losers from the dairy price war should be the bulk processors, not the farmers.

KS was pleased to recently see Mungalli Farm, our most prominent local food brand, recognised for the quality of their products. Depite premium prices Mungalli have problems maintaining supply to meet demand. Mungalli now accounts for 10% of Tablelands dairy farm supply.

A hearsay passed on recently was that a supplier to Mungalli had pulled out because it was too onerous to meet the Mungalli quality criteria rather than just supply the cheap bulk milk. Just hearsay!

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