THE end of $1 milk prices appears here as Coles and Aldi this week increased their in-house brand milk prices by 10c per litre.
The 10pc price jump – which both supermarket giants have made following extensive consultation with the dairy sector – comes a month after Woolworths made an identical move to end its $1 per litre scheme.
While welcoming the move after over eight years of lobbying from industry activists, the South Australian Dairy Association (SADA) believes there is still a long way to go.
“SADA does welcome the announcement by Coles and Aldi as further recognition the $1 retail price has been hurting farmers,” SADA chief executive Andrew Curtis said.
“This announcement is an important step in breaking the back of what really has been a crippling impost on the dairy industry.
“But it does not fix the problem – we believe in market forces being used to set the price of milk.
“The price of private label milk is still not the result of market forces.
“We acknowledge the efforts of major processors in working to ensure they are able to pass on the full 10c price rise to the farmers.
“We still encourage consumers who want to support the dairy industry to support branded products, because those products reflect the cost of production.”
Taking into account inflation, the $1.10 price remains equivalent to the $1 price point which was first introduced in 2011.
Between the three supermarket giants, around 696 million litres of milk was sold at $1 in the last year.
If sale trends continue, a 10pc increase should inject an extra $69.6m invested into the sector annually.
Drought, cost of feed, cost of energy, cost of fuel and also the cost of raising the family than runs the farm are among the financial factors in milk production significantly impacted by the $1 price point.
SADA has repeated calls for a shelf price which reflects all points across the supply chain.
Coles and Aldi said the 10pc increase was a temporary fix and they remained focused on supporting a permanent solution found through a government-orchestrated structural reform.