Pressure remains on dairy farmer returns

NSW Farmers is continuing to call for fairer prices for dairy farmers. 
Despite our dairy farmers being some of the most efficient in the world, profit margins continue to be compromised by unreasonably low retail prices and stagnated farm-gate prices. 
NSW Farmers Dairy Committee chair Colin Thompson says competition levers in the dairy supply chain have hollowed out industry profits, leading to devastating outcomes for farmers and even for consumers. 
“The major supermarkets have devalued popular dairy products like milk and cheese through setting the price of their private label products unrealistically low,” Mr Thompson said. 
“Low retail prices have decreased profits along the supply chain, and after processors take a cut, farmers can be left with very little.”
“The coronavirus crisis has highlighted that consumers value access to locally produced food, but unfortunately consumers could be hardest hit if current pricing structures continue. Without NSW dairy farmers, there is no fresh milk and no locally sourced cheese and butter.”
Mr Thompson is urging the supermarkets and processors to reassess their pricing models to help guarantee a future for the dairy industry in NSW. 
“It’s clear that fairer retail prices are in everyone’s best interests. We only need milk to be priced at $1.50 a litre and cheese $9.00 a kilogram to see improvements in the industry. It’s all that is needed to enable farmers to plan better for the future.”
“We also need processors to do their bit and ensure profit margins are being passed on to farmers.”
“We are echoing Agriculture Minister David Littleproud’s comments and reminding retailers and processors that they have the opportunity to do the right thing. They need to step up and help restore equilibrium in the dairy supply chain.”
 
“If fairer prices can’t be delivered, then we will need to explore other avenues for competition reform. We have already flagged the need for reform to unconscionable conduct provisions in Australian Consumer Law, but we continue to look for ways to restore balance in the supply chain.”