'The whole cabinet': Call for all dairy products to support industry, not just supermarket milk

Dairy industry needs immediate support, say South Coast farmers


Australian Dairyfarmer News
Toothdale dairy farmer Phil Ryan responds to a federal National Party election pledge for research into a new milk market platform. Photo: Ben Smyth

Toothdale dairy farmer Phil Ryan responds to a federal National Party election pledge for research into a new milk market platform. Photo: Ben Smyth

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Increasing a single line of milk products by 10c a litre barely makes a splash to the dairy industry a Bega Valley farmer says.

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Increasing a single line of milk products by 10c a litre barely makes a splash to the dairy industry a Bega Valley farmer says.

For improved farmgate prices and the survival of Australian dairy farmers, retailers are being called on to increase prices across the whole dairy cabinet.

Toothdale's Phil Ryan was one of a large group of South Coast dairy farmers who had the opportunity to bend the ear of federal Agriculture Minister David Littleproud on Wednesday.

Mr Littleproud was in Bega to announce the Coalition's election pledge to fund research and development of a more contemporary trading platform for the dairy industry.

Mr Ryan said he and his fellow farmers were appreciative of the face-to-face time with the federal minister so issues could be put directly to him.

However, He said the market platform measure doesn't go anywhere near far enough to assist an industry "losing 10 farms a week".

"We need something immediately, not just looking at a review into long-term reforms," Mr Ryan said.

Mr Ryan again turned the blowtorch on to the major supermarkets, calling on them to help strengthen the industry by increasing prices across the whole dairy cabinet, not just the 10c levy on 2L and 3L home brand milk.

That call was supported by Mr Littleproud and Nationals candidate for Eden-Monaro Sophie Wade during their Bega media call.

Twice as much milk is consumed as cheese and butter than drinking - Dairy farmer Phil Ryan

"Consumer perception based on clever in-store marketing is that the full 10 cents is going to all farmers," he said.

"In fact Woolworths' 10c levy goes to only approximately 450 farmers - and even then it only amounts to an extra 6c a litre for those farmers, because not all their milk goes to that specific product. They also have their milk used in 1L milk and so on, which doesn't have the levy applied."

Minister David Littleproud and Nationals candidate for Eden-Monaro Sophie Wade meet with South Coast dairy farmers at Bodalla on Wednesday. Photo: Supplied

Minister David Littleproud and Nationals candidate for Eden-Monaro Sophie Wade meet with South Coast dairy farmers at Bodalla on Wednesday. Photo: Supplied

Mr Ryan said retail pricing is the primary means to increase farmgate prices and the major chains had to step up across all dairy lines.

"Twice as much milk is consumed as cheese and butter than drinking," he said.

"Woolworths' home brand 1kg block of cheese is imported from New Zealand. There it sells for $8.50. Here it's $6.90. That's 16 cents a litre we need.

"If everyone's cheapest cheese was $8 there will still be people through the door.

"We don't want to be supplying cheaper products, we want them removed completely so consumers can support Aussie farmers."

On Mr Littleproud's pledge for a dairy market platform, Mr Ryan said "anything in favour of the dairy industry is a good thing", but more needed to be done in the short term.

"I'd like to see a commitment from both sides of politics to a dairy industry commissioner or ombudsman, someone who is responsible for, and to, the industry, managing the mandatory code of conduct and focused on the regulatory and moral responsibility of all players.

"I would also love to see a commission of inquiry or a royal commission into the dominance of supermarkets, not just dairy but for all primary producers.

"We love what we do, we're passionate, and we don't want to be working long hours just to lose the family farm. We want some money and some hope."

Nationals candidate for Eden-Monaro Sophie Wade also backed the call for the full suite of dairy products to be considered in the struggle for dairy farm survival.

"Our farmers here, particularly in Eden-Monaro, are under enormous stress, and we want them here for future generations," Ms Wade said.

"I want the full dairy cabinet because I want these guys to survive and I know from talking to them personally how hard it is for them."

Federal Agriculture Minister David Littleproud and Nationals candidate for Eden-Monaro Sophie Wade at the Bega Lookout on Wednesday. Photo: Ben Smyth

Federal Agriculture Minister David Littleproud and Nationals candidate for Eden-Monaro Sophie Wade at the Bega Lookout on Wednesday. Photo: Ben Smyth


On the new market platform proposal, Mr Littleproud said a re-elected Liberal-Nationals government would invest $560,000 to have Australian Dairy Farmers contract an independent research group to develop, consult and market test it, before reporting back in February 2020.

"Dairy farmers need more flexibility in how they sell milk - a new platform will give them more options, opportunities and flexibility," Mr Littleproud said.

"We want to not only strengthen dairy farmers hand in negotiations with processors, we also want to provide farmers more choice in the way they interact with the milk market to give farmers more market power.

"Dairy farmers currently have limited selling arrangements, basically a supply contract.

"A new platform could allow dairy farmers to market their future supply, and give them options to get better prices and reduce business risk.

"The project will look at the potential for a farmer to sell milk to multiple processors, or contract a portion of their future milk supply as a hedge - with an option to pull out and sell elsewhere if the farmer receives an offer to pay more for their milk.

"Trading future supply is available to other agricultural commodities but the dairy industry has not modernised in the same way. Perishability is often flagged as the barrier but if more contemporary trading models can deal with this and provide more certainty and more choice for dairy farmers to market their milk, I am all for it."

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