What’s next? Insight into QDO’s next steps to increase the farmgate price.

In March this year, QDO achieved a significant success with removing $1 litre milk from supermarket shelves.

This was not our end game; it was our start.

The campaign was intended to remove the artificial floor price created by marketing $1 milk. The incremental price increase that farmers have received as a result of this campaign is by no means enough.

Over the last few months we have had a few members ask what QDO is planning to push for a higher, sustainable farmgate price.

Our first campaign capitalised on consumer awareness and support for farmers facing drought conditions to spearhead the push to increase the farmgate price. While over 65% of Queensland is still drought declared consumers, those who live in our major population centres are receiving steady rain and don’t see that the drought continues and continues to put the future of our industry in jeopardy.

Is it fair? No. Is it logical? No. Unfortunately for us all, it is simply the fact that we are faced with.

While they may seem far removed from the negotiating table that we are used to, the first campaign showed us that the 24 million odd Australians consuming our product daily, are powerful allies for our industry.

Educating consumers about the impact that their purchasing behaviour has, is vital to negotiating a higher farmgate price and this is our first step.

QDO is working with other state organisations to develop the strategy. A lot of planning, meetings, consultations etc are taking place in the background as we develop the next campaign to increase the value across the whole dairy cabinet.

We will be consulting with processors, supermarkets, relevant politicians and government bodies over the coming months so that the campaign has the best chance of lasting success.

Simply put, there is no quick fix. Drought and many other factors continue to put pressure on farm production costs, and these won’t end any time soon. But to ensure that we get farmers a sustainable price, we need to work smarter and we need to work together.

If you would like to help once the campaign kicks off, please get in touch with the QDO office.

QDO President – Brian Tessmann

 

Federal Labor to introduce dairy floor price if elected.

THE Federal Opposition has given the clearest indication yet that a dairy floor price will be introduced by Labor if elected on May 18.

Re-regulation of the sector was floated as an option by Opposition Leader Bill Shorten earlier this year, committing to improve conditions for dairy farmers if Labor won Government.

Shadow Agriculture Minister Joel Fitzgibbon last week said structural problems in the dairy sector “could not be overcome without government intervention.”

“You can somewhat rebalance the market power between processors and dairy farmers, but dairy farmers will be made price takers,” the Labor frontbencher said.

“So I formed a view that the only way you really help dairy farmers is to set a minimum farmgate milk price. Not a ceiling but a floor price.

It means you would have an entity, possibly the ACCC, determine what is the average price of production in each dairy region, because every dairy region is very different. And having determined that average price, set a minimum price somewhere just above the cost of production.”

United Dairyfarmers of Victoria president Paul Mumford said the organisation welcomed either a Labor or Coalition government working to improve the fortunes of the dairy sector over the next three years.

“Whether a floor price is the right solution, we wait to see, but Joel Fitzgibbon said he would work with the ACCC to evaluate the situation,” Mr Mumford said.

The Australian Dairy Industry Council approached the Howard government in 1999 to deregulate the drinking milk sector.

All state governments then repealed legislation governing milk prices, with state-based milk authorities wound up by July 2000.

The move had a mixed result for farmers nationally, with Murray Goulburn and Bonlac offering higher farmgate prices in Victoria and Tasmania in 2000-01 but a marked decrease for NSW and Queensland producers during the same 12-month period.

Mr Fitzgibbon was asked by The Weekly Times how an Australian floor price would operate in competition with imported produce from New Zealand.

“If we are arguing that the only way to be internationally competitive on export markets is to pay our farmers at or below the cost of production, then we’ve lost the argument,” the NSW MP said.

“If we’ve got to underpay our farmers to be internationally competitive, it’s a market we shouldn’t be in, quite frankly. But that’s not the outcome we want. Of course, we want to be in the market, we want Australians drinking milk produced here in Australia and other dairy products. They are literally facing a crisis at the moment, particularly in areas like northern Victoria. If we don’t have government intervention, we will lose our dairy industry.”

Source: Weekly Times