World Milk Day to highlight the crisis within the Queensland dairy industry. What you need to know.

Saturday June 1 is World Milk Day. It is meant to be a celebration of the dairy industry and an acknowledgement of the value of dairy in our diet and lifestyle.

This year however, we need the International Milk Day to be used to highlight the desperate state of the dairy industry in Queensland.

The bald fact is that the Queensland dairy industry can no longer meet its domestic market consumption requirements and we are unlikely to recover production volumes to meet domestic demand.

Drought conditions and the poor farmgate price for raw milk have led many farmers to sell up and leave the industry. Not only is this devastating for the farmers, their family and communities involved, but it is sad for all Queenslanders who love their dairy.

On average, Australians consume 102 litres of fresh milk per person, per year.

In years gone by, around 95% of all milk produced in Queensland went into fresh milk product; that is, fresh bottled milk. The 5% remaining was used by small processors manufacturing boutique cheeses, yoghurts and ice-cream. Now, milk needs to come from interstate to meet our state’s consumption.

Consumers and the media are somewhat fickle in their attention to the climate conditions that farmers are still facing. The rain received in the coastal regions over the Easter period led most Queenslanders in major cities to believe that the drought that was so widely covered by the media in 2018, was over.

Only one month ago, the Queensland Government was forced to extend the drought declared mapping area to include all the Scenic Rim and Lockyer Valley, Burnett and Rockhampton regions. Now a staggering 65% of Queensland is drought declared and the Bureau of Meteorology do not have any hopes of unseasonable falls over the coming months.  

Farmers continue to struggle with the price of feed and now water for irrigation is fast becoming a point of major contention across Australia.

The end of $1/L milk was certainly a win for dairy farmers in Queensland. It not only gave farmers a price increase but clearly showed the market that farmers would no longer accept retailers setting a minimum RRP for fresh milk.

One thing however still mars the success of the campaign. It is a widely held misconception that those farmers supplying a processors without a generic contract currently receive no income from the 10-cents a litre.

It is in fact only a portion (around 30%) of most farms’ milk that is allocated to private label (Coles/Woolworths/Aldi and IGA home brands) receives the 10-cent price increase. What this means is that farmers are on average receiving only around 3-cents more per litre across their full volume.

“We didn’t hear a single complaint from shoppers when the price of private label milk increased by 10 cents. As our research showed, shoppers are happy to pay more if it helps the farmers and helps ensure they get fresh milk in future. This doesn’t just apply to cheap milk, but to branded milk too” said QDO Vice President Matthew Trace.

“Unfortunately, help has come too late for many farmers and we’ve lost the ability to supply 100% Queensland made milk unless farmers can make a sustained profit.

While our farmers appreciate the price increase and appreciate the support that consumers have shown, the 10-cents increase needs to be applied to all the milk we produce. All processors need to utilise the opportunity that the end of $1/L milk provides them. They have to have the guts to increase the RRP for branded milk and pass that full increase back to their farmers. That way they will be able to secure their milk supplies by ensuring that dairy in Queensland is profitable” said Mr Trace.


UDV slams failure to help farmers.

Paul Mumford.jpg

United Dairyfarmers of Victoria president Paul Mumford has slammed processors, retailers, government and industry organisations for not doing enough to help dairy farmers.

In a hard-hitting address to the organisation's annual general meeting in Melbourne on Friday, Mr Mumford challenged all sectors to do more to alleviate the pressure on farmers.

He later told the Australian Dairyfarmer farmers were exhausted to a point where they were unable to continue in the future.

"We've got to change that," he said.

He pointed in particular at processors and retailers for not sharing enough of their profits with farmers.

"Essentially they are protecting their own nest," he said.

"They are part of the food chain from paddock to plate and they haven't realised the value of the supply chain.

"They are looking after their own little piece of their own little investment; we've got to start looking at the whole system."

He questioned why milk processors, who were giving signals of strong pricing for next season as they chased milk in the face of falling on-farm production, had not lifted current season prices.

"The roles that processors play here in Victoria must be addressed," he said.

"A good industry is one built on trust, transparency and a ‘fair go’ for all.

"Since 2016 our relationship has been fractured and the wounds have not healed.

"We are looking for a show of goodwill; recognition from you of the importance of having a strong relationship with your farmers.

"Will you step up and make a genuine commitment to work hand-in-hand with us to take our industry forward?"

Mr Mumford also slammed retailers and said the recent rise in $1 a litre milk was not enough to help farmers.

"We've got to look at whole dairy cabinet," he said.

"It is just not the 10 cents a litre (rise).

"That is misinforming the consumer ... allowing them to think that 10 cents is the saviour to the dairy industry.

"That is not right; we have to look at the $6 cheese, the cream, the butter."

Mr Mumford said irrigators in northern Victoria, who had shown extreme efficiencies, appeared to be continually asked to deliver more to the Murray Darling Basin Plan when other states did not show the same technological improvements or commitment to efficiency.

"I am disappointed to say that our farmers and their communities in the north have been let down by industry, processors and governments," he said.

Mr Mumford asked governments if they would commit to engaging directly with farmers.

"Where are you?," he said.

"Will you commit to ... getting out to the farms in the regions to see first-hand what impact these conditions are having on family farm businesses and their communities and work with us to deliver solutions?"

He also criticised Dairy Australia for not taking greater action to prepare farmers for this situation.

"What happened to our industry preparedness?" he asked.

"Why were our levy investments not better targeted to deliver the preparedness required?"

Mr Mumford also questioned Australian Dairy Farmers' approach to long-term advocacy challenges, such as those posed by animal activists.

"Are you a best practice advocacy organisation well placed to deliver for members?" he asked.

Mr Mumford said the new Dairyplan must provide more than a website and a nice brochure.

The plan must deliver on its promise.

It was vital every dairy farmer across the state was engaged in the Dairyplan.

"I highly recommend everyone have their say in the Dairyplan," he said.

"If the Dairyplan says the UDV has to have its head chopped off and a new structure formed, then that's what has to happen.

"We've got to look at what the benefit for the dairy industry is and not just my role or ADF role or Dairy Australia role.

"We've got to look at the big picture and then enact it."