Queensland dairy farmers wary as Woolworths pulls Norco milk from stores

But an industry leader is concerned the supermarket giant did not consult farmers or consumers before making its decision involving about 150 stores.

Josephville, Qld, dairy farmer Laurie Dunne, who supplies to Norco, said it was hard to tell what would happen to Queensland as a result of the Woolworths' decision.

"We don't know what is going to happen with Norco. I haven't heard what percentage of that milk is lost, they are still selling into Sydney through Coles I'd imagine," he said.

"They are bringing more milk in from further south to fill the market here. North Queensland hasn't got enough milk, they are struggling."

Whilst there is competition for milk suppliers to major supermarket chains, Mr Dunne said Norco was the only brand that was 100 per cent owned dairy co-operative with profits going back to Australian farmers.

"It's really difficult to know where it is all going to end. Norco is a 100 per cent co-operative and they are the only one that is a processing co-operative in Australia. (The company) Dairy Farmers sell their milk, mostly to Bega," he said.

"So, that message from Norco is, these are the farmers that are producing the milk that you are buying and it's their profits - it's a full cycle which is good.

"It's all Australian farmers no matter which way you look at it. Lactalis's profit is going back to France, Norco is coming here and you'd like to think it's worth supporting the local farmers, local companies and investing in the right area.

A Woolworths spokesperson said they had a close relationship with Norco and stocked their products in Queensland and NSW stores, north of Sydney.

"While we have seen lower demand for Norco in metropolitan Sydney stores, we know they have a very loyal following up north and we've actually increased the range of Norco products in all our Queensland stores and New South Wales stores, north of Sydney," the spokesperson said.

"We've worked together with Norco on this change and we'll continue to partner with them to deliver quality milk based on customer demand.

"In Sydney stores, we continue to offer our customers milk from Australian-owned dairies including Riverina and Dairy Farmers. All our fresh milk is 100 per cent Australian sourced.

EastAUSmilk chair Joe Bradley said he was concerned about the move from Woolworths to make a decision without farmer or consumer input that impacts both groups.

"To me, it's a worry. Woolies' initial press release talked about 90 stores, but now I'm hearing 150 stores," he said.

"It concerns me that Woolies has decided on behalf of consumers and farmers that Norco will now not be sold in some of their stores.

"I know they have said 'we'll make it up to you in northern NSW and Queensland', I think that's a furphy, but I hope I'm proven wrong...I think it's one way they will put their own branded stuff in the stores.

"People are digging around and I'm getting calls from the public suggesting that Norco milk was not being restocked at Woolies' stores.

"Norco is part of the northern dairy industry and for someone to pull (the products) of a farmer owned co-op is harsh...the consumer wasn't asked and certainly not the farmers."

Mr Dunne said industry deregulation in 2000 saw prices go down from 58c/litre to about 30c/litre and he wondered then how they would survive, but they did.

"Since deregulation, in 2007 to 2009, we reached a stage where we were losing all our dairy farmers, then in 2010 we had the terrible floods and then Coles started selling milk at $1/litre, which brought the price crashing back down again," he said.

"In 2019, we had a severe drought, there was no hay, we had to get hay from up north. It was horrendous. The price had to go up and it did."

But, in the last three years, the Dunne family has been able to invest in the farm which, Mr Dunne said, was a long time coming.

"We are okay at the moment...it's bloody hard but you do it, there were times where I didn't know if we were going to continue," he said.

"We have gotten to the stage in our industry where we need to invest or close it down, we had no choice, otherwise I'm not sure if we'd be here."