Wednesday, July 6, 2022

Dairy farmers threaten blockade

Dairy farmers have threatened to blockade supermarkets to demand fairer farmgate milk prices.

The blockade, with machinery, was one idea raised at emotional dairy industry crisis meeting of more than 600 people in southwest Victoria on Monday.

The meeting, which spilled out of the Kolora-Noorat Football Club's rooms, was told it should draw attention to the plight of the struggling industry by hurting the powerful duopoly for discounting house-brand milk.

Two years ago Coles and Woolworths cut the price of their brand milk to $1 a litre. Last week both chains extended the price discounting to their convenience store outlets.

"We could drive machinery into town and park it in the car park … make a statement," dairy consultant Mike Hamblin said.

Monday's meeting was also told:

  • Income would be down up to $260,000 this season for farmers.
  • Feed costs were up 15%.
  • Electricity prices had risen 50% in the first quarter of this financial year.
  • There was an oversupply of dairy properties on the market.
  • Dairy farm values were down by as much as 4%.
  • Businesses were suffering due to dairy industry downturn.

Carpendeit dairy farmer Ray Waghorn described milk processors as "the fox in-charge of the hen house" and was appalled at their "condescending" attitude towards farmers.

Charles Dillon, whose Dillon's Dairy Supplies services dairy farmers from Apollo Bay to Mt Gambier in South Australia, said 60-70% of his clients ran bills out to 90 days or more now.

"No one has got any money," he said.

"It is not just the dairy farmers who are suffering, (we) all feed off the dairy farmers, small towns will die."

Milk payment systems were also in the firing line as farmers asked where the extra money was at farmgate for supplying milk all-year round.

State and federal dairy lobby groups as well as Dairy Australia came under attack.

Pomborneit's Ben Bennett asked if industry vested interests pushing for increased milk production cared about the profitability of milk suppliers.

United Dairyfarmers' of Victoria president Kerry Callow called for more involvement from farmers in industry issues and "one voice won't do it".

South Purrumbete's Adam Jenkins suggested labour market reform, such as changes to penalty rates and unfair dismissal laws as well as changes to fuel tax and small business tax relief.

He said the poor state of local roads added to transport costs.

Other suggestions at the meeting included interest-free "survival loans", a consumer levy on white milk and carbon tax compensation. A "working group" of five farmers, including meeting organisers Phillip Bond of Taroon and Chris Gleeson of Crossley, will send a list of industry "demands" to milk factories, governments and other interested parties.

Meeting participants were asked to register for possible future events, including supermarket blockades.

Neither Coles or Woolworths commented yesterday on potential blockades.

Coles merchandise director John Durkan said he recognised Victorian dairy farmers were facing difficulties.

"To insulate farmers from the introduction of $1-a-litre milk, we paid a higher price to dairy processing companies in Victoria and fully absorbed the lower retail price by reducing our own margin from an average of 55c on a two-litre pack to an average of 10c for two litres," he said.

Woolworths said its discounting was in response to Coles.

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