Dairy farmers in battle for better milk price deal
DAIRY farmers are sick and tired of being screwed over on price.
Queensland Dairyfarmers Organisation vice-president Ross McInnes, whose dairy farm in Harrisville has produced milk for 99 years, is calling on the Federal Government to implement a mandatory code of conduct between the National Retailers Association and the industry to give dairy producers a fair go.
"We also want an ombudsman appointed to look at the conduct of large supermarkets in Australia because of what is happening with the milk price war," he said.
"That will also require a strengthening of the competition and consumer act.
"Up until 10 years ago it did have some teeth to it, but it has been watered down that much that you can't get anything out of it. Agriculture Minister Joel Fitzgibbon in late July supported calls for a mandatory code of conduct but by August 14 he was doing the old Canberra shuffle and walked away from it.
"An ombudsman would be there to ensure tendering processes from supermarkets down... were fair and legitimate."
While the farmers are getting little for their milk, costs have skyrocketed.
"In Queensland 60% of milk is sold for $1 a litre, the same as it was 21 years ago," Mr McInnes said.
"We are getting 10% more than we were 21 years ago, but the higher quality requirements we now have takes about 7% of that out. Labour costs went up by more than 100%. The year just finished our electricity bill was $85,000...up from just over $50,000 the previous year. Farmers are leaving (the industry) at an unprecedented rate and unless something happens very soon as a trigger to give them some positivity they will continue to leave. South of Ipswich in the Rosevale, Harrisville, Boonah, Maroon area there are only 24 dairies left. In 1999 there were 82."
Mr McInnes said farmers were getting "just over 50 cents a litre".
"But it has got to be closer to 60 cents than 50 cents.
"When supermarket branded milk prices went down, branded sales of Dairy Farmers and Paul's milk lost market share. Now those branded prices have come down to compete with the supermarket brands. As a result $200 million has been taken out of the supply chain annually. The damages bill of the average dairy farmer in the 2011 floods and cyclones, equated to 30% of their annual turnover. We were on our knees, and then they (the major supermarkets) pulled the prices back to what it was 21 years ago."
Blair MP Shayne Neumann met well-known dairy farmer and Premium Milk chairman John Cochrane and Mr Fitzgibbon this week to solve issues facing the industry. A big dairy farmers' forum on the industry crisis is being held in Esk on Sunday.
"I am going up on Sunday to Esk to have discussions with the farmers, but they still have not been able to tell me what they want in the mandatory code," Mr Neumann said.
Mr Neumann said a voluntary code could work with the right mechanisms but Mr McInnes said it would be a toothless tiger.