Dairy farmers, milk firms resume raw milk price talks

SEOUL (Yonhap) - Dairy farmers and milk companies in South Korea resumed talks Monday to determine how much and when to raise the prices of raw milk after failing to find middle ground last week, industry sources said.
Both sides failed to iron out their differences on Friday after holding three days of negotiations on price hikes of unpasteurized milk. That breakdown grinded the price talks that started on June 21 to a halt, raising concerns that the milk supply could be disrupted.
They had a "cooling-off" period over the weekend and decided to restart the price talks, the sources said.
Milk companies earlier accepted the government's proposal to raise raw milk prices by 138 won (US$0.12) per liter, but dairy farmers stuck to their demand that the prices be raised by 145 won.
The sources said that the difference that led to Friday's breakdown could be narrowed as farmers expressed their intention to accept the government's proposal.
Both sides, however, still remain far apart on when the price hikes should be enforced.
Farmers are demanding that prices be adjusted retroactively on Aug. 1, while dairy companies called for prices to be raised starting on Jan. 1 next year in line with the government's request to restrain from hiking prices until the end of this year.
The average price for a liter of raw milk, which needs to be pasteurized before being sold in stores, stands at 704 won. The price has remained unchanged since 2008.
The talks have been closely watched as milk is one of the key daily necessities for Koreans, and the government has been keeping an eye on any price increases that could exert upward pressure on the nation's already high consumer prices.