You only have to listen to South Coast dairy farmer Robert Miller’s response to Woolworths’ decision to cease selling discount milk to get a handle on the grim hardships he and others in the industry face.
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Welcoming the news of the retail giant’s decision, the Milton farmer said the extra 10 cents per litre on the farm gate price would take him and other suppliers on the South Coast to the break-even point.
That’s how tough things have been for dairy farmers, many of whom, including Mr Miller, have had to reduce their herds and lay off staff. The double whammy of drought, which has lifted feed prices, and the discount milk war has seen many producers simply walk away from the industry.
According to Mr Miller, the crisis in the dairy industry has been so severe, Australia has become a net importer of dairy products. New Zealand’s dairy industry, he says, is now bigger than ours.
While the Woolworths announcement is good news, it only makes life marginally better for about half of the Shoalhaven’s dairy farmers. For those whose milk is destined for Coles, which has not matched Woolworths, times will continue to be tough.
The milk discount war began in 2011. Its effects have been to suppress prices farmers receive for their product. To get an understanding of the effect on producers, imagine working in the same job for eight years and not receiving a pay increase in all that time, while the cost of living has risen year on year.
Such stagnation simply wouldn’t be tolerated.
The decision by Woolworths effectively adds just 10 cents a litre to the farm gate price. It’s a small step but a step in the right direction. As federal Agriculture Minister David Littleproud sees it, much more needs to be done to restore this important primary industry. And he has Coles and Aldi squarely in his sights.
“Coles and Aldi continue to sell milk at $1. This drives down prices to farmers. Supermarkets can’t pretend selling milk cheap doesn’t hurt farmers and they’ve got to be called out on this rubbish,” he said in a statement shortly after the Woolworths announcement.
Consumers have a clear choice. They can support the industry by avoiding the discount milk. Paying a little extra will not only send a message to the recalcitrant retail giants, it will help a local industry that, in turn, helps local economies.
