and Grana Padano markets, and documents the ensuing significant price transmission
changes both within each chain and between the chains.
In October 1996 the two producers associations were found guilty of uncompetitive
behavior and given three months to change it, de facto terminating any market
coordination practice. This resulted in significantly lower prices for the cheese producers
with little benefit accruing to the final consumer, a perverse result for an investigation
initiated on concerns for retail prices.
The ‘self-regulation of producers’ mandated by agricultural policies provided leverage
when confronting the market power of wholesalers and retailers. The IAA ruling
obviously has changed this equilibrium. The decision has affected more the Parmigiano
Reggiano, whose producers face the most restrictive production protocol, and, because
of that, have the most expensive milk with no alternate uses.