PEAK dairy farmer group Australian Dairy Farmers (ADF) has renewed calls for industry unity in finding reasonable solutions to address declining farmgate returns.
The latest Dairy Australia Situation and Outlook report, released this week, attributed a trend of declining farm profitability to soaring production costs combined with relatively steady milk prices.
ADF chief executive David Inall said the immediate challenge was to urge supermarkets to raise the price of their discount milk lines on the back of Woolworths move to raise its $1 per litre milk brand to $1.10, with the full 10 cent increase to go directly to farmers.
“Coles has just raised the price of bread due to high grain prices so there is no reason why they should not also acknowledge the hard work and tight margins of their dairy suppliers,” Mr Inall said.
“Retailers cannot continue selling cheap milk while simultaneously raising the price of other products to help drought-stricken farmers.”
Coles is yet to follow Woolworths with a similar initiative, instead proposing an industry-wide levy on milk.
Aldi has so far rejected calls to raise the price of its discount milk line, which retails for 99 cents.
“The dairy industry has suffered from the debilitating effects of dollar milk for eight years, since Australia Day 2011 and the retailers have an opportunity to come to the table and help us implement change,” Mr Inall said.
The Federal Labor party announced this week it would investigate the efficacy of a minimum farm gate milk price if it wins the next election.
Mr Inall said while the industry group appreciated the recognition from the federal Opposition and other stakeholders, he conceded there were no immediate or simple solutions to address all problems afflicting farmers.
“We are committed to working constructively through this proposal because farmers are telling us that something must change to secure the future of the Australian dairy industry,” he said.
“It is vital now that we work with the Australian Competition and Consumer Commission (ACCC) and our members in a dedicated effort to represent dairy farmers in what are unprecedented, difficult times.”
