Farmers taste Coles milk deal … and it’s a little sour

Farmers were divided yesterday over Coles’ fighting fund for dairy farmers: some applauded the decision and others said it was a PR stunt.
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As dairy farmers faced rising winter costs for feed, farming groups welcomed the supermarket giant’s commitment to launch a new milk brand in Victoria and southern NSW that will pour 20c a litre back into the dairy sector.
However, some dairy farmers remain sceptical, others even angry, remembering that it was only five years ago that Coles blitzed the market with its $1-a-litre milk that sent politicians and farming groups into a rage over the affect to the farmgate price.
“The $1 milk did devalue the perception of milk and milk products, but how big an impact it had on farmgate prices is a different issue,’’ said Craig Dettling, a dairy farmer with 250 cows in Victoria’s Warrnambool. “But we do welcome Coles trying to do something. I’m a bit cautious … what impact it will it actually have?’’
A similar program in South Australia, in which Coles created a new milk brand called SADA Fresh, has raised $200,000 a year for a local education and innovation fund for that state’s dairy producers.
“Dairy Australia already has a levy for that kind of thing … is there a need to double up?’’ Mr Dettling said. “There could be questions around doubling up as opposed to paying higher price for milk in the first place.’’
It comes as the dairy industry faces a crisis over collapsing milk prices, influenced by overseas economic and political forces, and triggered last month when the nation’s biggest milk producer Murray Goulburn, cut the price it pays to its 2600 supplier farmers. MG slashed the price it pays farmers for milk from $6.05 per kilo of milk solids to $5.47, which for many is below the cost of production.
MG’s board has agreed to waive its fees and management will get no short-term bonus this year, chairman Philip Tracy said in a letter to farmers yesterday ­obtained by The Australian.
Mr Tracy apologised to farmers under “immense pressure” due to the company’s milk price cut and earnings downgrade on April 27, saying it would consider paying farmers upfront under a support package announced the same day.
“The board and I are very disappointed and sorry to have placed you in this position, particularly so late in the season,” he said. He asked farmers to “rally behind MG and support management” in its strategy of making value-added products such as cheese.
Victorian Farmers Federation president Peter Tuohey remembers the anger when Coles launched its $1 milk, and he hopes Coles’ promises to help will help.
He said he would seek to work with Coles to help develop the structure of a proposed fighting fund, saying it should be aimed at immediate hardship and disaster support for local dairy farmers as winter approaches.

Mirá También

Así lo expresó Domingo Possetto, secretario de la seccional Rafaela, quien además, afirmó que a los productores «habitualmente los ignoran los gobiernos». Además, reconoció la labor de los empresarios de las firmas locales y aseguró que están «esperanzados» con la negociación entre SanCor y Adecoagro.

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