Farmers embrace milk price
South West dairy farmers have welcomed the move by Coles and Aldi to increase their milk price by 10 cents per litre on their two and three-litre home-brand milk.
This follows Woolworths increasing its home-brand milk by the same amount in February.
The changes come after almost eight years of negotiations by WAFarmers dairy section representatives and the national advocacy organisation Australian Dairy Farmers.
Wokalup-based Halls Family Dairy co-owner Suzanne Hall has welcomed the move.
“It’s a great start,” Mrs Hall said.
“Hopefully it will lead to a price rise for all milk products.”
WA Farmers dairy section president Michael Partridge welcomed the decision from the two supermarkets as a positive step towards getting value back into the dairy supply chain.
“It is important that all participants in the supply chain are able to make a fair profit,” Mr Partridge said.
“It is disappointing for dairy farmers to see a highly nutritious product like milk be devalued by unsustainable pricing policies set by major retailers, and we commend Woolworths and now Coles and Aldi for taking this positive step forward by increasing their milk prices.”
Coles Group chief executive officer Steven Cain said the company was paying dairy processors the highest farm-gate milk prices in four years.
“Coles sources 100 per cent of our Coles Brand fresh milk from Australian farmers, many of whom are struggling as the impact of drought compounds ongoing challenges in the dairy industry,” Mr Cain said.
He said the company was continuing to explore long-term solutions with government and industry stakeholders to make Australia’s dairy industry more sustainable. “However, we know that many dairy farmers cannot wait for structural reform to be delivered so we are moving to provide relief right now,” he said.
Aldi Australia managing director of buying Oliver Bongardt cited the significant pressures on the dairy industry as the reason behind the company’s decision.
“Our decision to increase fresh milk prices has been reached in recognition of the significant issues currently impacting the dairy industry and the fact that broader government-led policy reform is unlikely to occur in the short-term,” Mr Bongardt said.
He said Aldi had been so far able to absorb cost increases from its milk processors due to the drought conditions over East without needing to pass these costs onto customers.
“This solution is a short-term measure and will allow our processors to immediately pass additional funds to farmers outside of normal seasonal adjustments,” Mr Bongardt said.
“We look forward to the introduction of government-orchestrated structural reform in accordance with the recommendations of the ACCC’s 2018 Dairy Inquiry final report.”
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