Some Structural Characteristics of the Venezuelan Milk Industry

The few commercial dairy processors in Venezuela are of substantial size and highly integrated. Fluid milk companies divide sales territories, and there is no government legislation to regulate such monopoly practices. In general there is no advertising and little service to producers or consumers. Farmers get 75 percent of the moderate consumer price, and the quality of most products is good. The assets per dollar of sales average 11 times as high as in Wisconsin; profits per dollar of assets are 50 percent above the Wisconsin average. Government furnishes few public services and tries to improve industry performance with a number of detailed decrees. The bottled milk industry has developed rapidly but policy changes are needed to induce further evolution of the dairy industry.