An independent Bay food retailer today slashed the price of milk to $1 a litre - and says it is prepared to lose money on the deal to encourage people to improve their diets.
From 8am, The Good Food Trading Company in Mount Maunganui will sell two litres of milk for $2, down from the normal retail price of $4.50.
This special on Cow and Gate milk will remain in place for the remainder of this month.
The move is expected to put pressure on supermarkets and comes at a time when the cost of milk is in the national and political spotlight. Other dairies and superettes say they are also losing money on milk for the public good.
The Good Food Trading Company owner Jamie Blennerhassett told the Bay of Plenty Times milk should be a staple item in people's daily diet but the current price made it highly unaffordable.
"As a store we try to focus on getting people to eat fresh, healthy and sustainable options. When people start drinking less milk because of its price compared to less healthy soft drink options, you know something is wrong," he said.
"We decided we needed to take a stand and encourage people back to the more healthy option of milk by slashing the price to one that everyone can afford."
The store will take a direct hit as a result of this initiative and Mr Blennerhassett said their loss would be "reasonable" but it was something the store was prepared to do.
"We're going to take a loss on every bottle we sell because we don't have the buying power of the big supermarkets but it's about making a stand which we feel passionate about and which fits within our core philosophies."
Mr Blennerhassett said healthy and tasty food options did not need to come at a cost and people needed to look to fresher and healthier staples instead of mass produced snack and processed food items of the big supermarket brands.
"Many people think going to a supermarket where things are bought in bulk is a cheaper option when more often that not if you go down to your local dairy or petrol station you will often find milk is cheaper than at the supermarket," he said.
"Milk is a base food item and one that should be able to be a staple in everyone's diets ... and with this we're hoping to put a bit of pressure on the rest of the marketplace."
Milk is ordered daily at The Good Food Trading Company and the store has doubled its milk orders in preparation for an influx of customers.
The milk special could continue beyond the end of the month, depending on how supermarkets and other milk suppliers responded to this initiative, Mr Blennerhassett said.
"If the demand is here then we will keep these low costs but if the people don't respond then we will have to re-address the situation," he said.
The move was made in conjunction with another independent food retailer, Nosh Food Markets, based in Auckland and Hamilton, which yesterday slashed the price of milk to $1 a litre in its six stores.
Dairies, superettes and other produce stores in the Western Bay offered constant milk specials.
Big Tobacco Discounter on Cameron Rd has offered milk specials since the store opened two-and-a-half years ago. Cow and Gate branded milk currently sells at the store for $2.99 a two-litre bottle.
Store manager Mike Lawrence said many people in the community were "struggling" and the low price of milk offered some respite when other necessities were also expensive.
Bellevue Superette has offered reduced milk prices since the middle of last year. Two two-litres of milk currently sells at for $5.99.
Owner Harjit Singh Rai said milk was a "necessity" and he was aware many customers were on low incomes.
"Milk is a necessity and the price of everything else is going up and we don't make a [profit] on this at all but we're helping the local community."
At Bureta Superette and Matua Dairy, bulk buying paid off as two two-litre bottles of milk cost $6.
Owner Balvir Singh said the discount was a way to keep milk affordable. From Monday, the store will further discount milk for two two-litre bottles for $5.50.
Mr Singh said the store made a small loss on the discounted milk, "but the customers are really happy so we'll keep doing it".
At The Fresh Market in Gate Pa, the price of Cow and Gate milk was discounted for $3.50 for a two-litre bottle or $6 for two bottles.
Manager Logan Cullum said the reason behind the special was to offer customers the option of choosing cheaper milk or other branded full-priced milk, which went for around $5 for two litres.
"It's about offering variety and when you bulk buy you save that extra dollar."
"It's nice to be able to do this for our customers because we definitely don't make anything out of it."
Last year, Parliament's commerce committee, then chaired by Lianne Dalziel, launched a broad-based inquiry with an overarching question of whether people were paying too much for milk and whether the market was operating effectively at all levels.
According to Statistics New Zealand, the average price of a standard two litres of milk in December was $3.67 - up 1.7 per cent on December the previous year but 15.4 per cent higher than in the same month in 2009.
The commerce committee of the new Parliament is chaired by Todd McClay and has until February 29 to decide whether to continue the inquiry.