It is a win win situation

Oct 07, 2016

Collaboration is the key to get us where we need to be. Our industry relies on all the elements to operate effectively. Farmers need processors and vice versa – so the solutions require all of us to come together to ensure a positive future. It is a win win situation.

It is one thing to constantly pick apart the industry to highlight the problems, it is another to actually work together to bring about real solutions to ensure this never happens again.

Last week the Australian Dairy Farmers held an important meeting with state dairy organisation presidents and processors to address a range of contractual issues which farmer organisations have been trying to address and rectify for 15 years.

During the meeting we discussed a range of topics including the difficult circumstances of farm gate price reductions, the introduction of new legislation on unfair contracts which comes into effect in November and the outcomes from the August Symposium held by Deputy Prime Minister, Barnaby Joyce.

This meeting provided an ideal opportunity for the dairy industry to unite and develop a voluntary industry wide code of practice on contractual arrangements with farmers.

The code will include:

  - greater transparency in contracts and supply agreements

  - ensuring a pricing formula or a price setting mechanism is clearly defined within a contract

  - ensuring pricing adjustments to farmers throughout a contract are clearly defined and that there will be no retrospectivity

  - while acknowledging step ups do occur and step downs have occurred in severe circumstances, a principle should be incorporated into contracts which clearly outlines that as much notice as possible is necessary if a step-down has to occur

  - ensuring farmers should receive all payments that accrue over the term of a contract or supply agreement – the final payments of a contract should not be contingent on the farmer being a supplier when, for example, the June payment is made in mid-July

  - ensure that where a processor has a contracted volume limit or a different price for volume above a particular level then exclusivity of supply to that processor must not occur

  - ensuring there is a clearly defined mechanism for giving notice of termination of a contract

  - ensuring there is a clearly defined mechanism of how contract terms and conditions can be modified and the farmer having the right to a negotiated variation, not simply a request from the processor.

Incorporating these principles into a code of conduct will give farmers, or their representative, the opportunity to have a contract or supply agreement which is truly negotiated and not simply an agreement which is a “take it or leave” it approach to farmer’s milk supply arrangements.

The ADF together with the state member organisations have worked hard since the crisis unfolded to ensure future milk supply agreements are balanced, fair and transparent. It has been a long process to get to this stage and a major breakthrough for the entire industry.

State dairy farmer organisations have been working to achieve these improvements for many years. By having a national organisation which is well resourced the States can achieve things together that would be impossible to achieve on their own.

We plan on finalising the draft code as soon as possible, ahead of the new legislation and before the Australian Competition and Consumer Commission inquiry into the dairy industry is finalised next year.

Now more than ever, the dairy industry needs to remain focused and united in its goals to achieve a shared vision of improving the profitability and sustainability of dairy farmers and the entire dairy industry in Australia.

David Basham

Acting ADF President

 

 



Collaboration key to dairy success

Jul 09, 2016

With the official announcement of last weekend’s election yet to be made, the dairy sector (like the rest of the nation) is watching very closely and working to ensure that all political parties understand our priorities. Whatever the outcome, it is essential that stability reigns – effective policy formation and clear action to overcome challenges will be otherwise impossible.

Australian Dairy Farmers (ADF) has made clear its priorities for the next government – extend and streamline access to the concessional loans and Farm Household Assistance for all affected farmers, create a safer, more resilient workforce, ensure secure sustainable access to water resources and above all, address the imbalance of market power within the dairy supply chain.

It’s good to see that all parties have recognised the importance of supporting our farmers through the current challenge, as well as committing to developing innovative solutions to building long term sustainability of our industry.

However, it is concerning to see some are still calling for a fresh milk levy – an unworkable solution. If a fresh milk levy was imposed, it would potentially result in farmers who supply domestic markets subsidising their export market oriented counterparts. This is not a workable solution.

There are also potential difficulties associated with such a levy breaching Australian Competition and Consumer Commission regulations as well as potential issues with the World Trade Organisation.

The fundamental issue our farmers continue to face is that they wear the bulk of financial risk in the dairy supply chain. We need a practical and viable solution to increase transparency in the way the milk pricing system works and to simplify milk contracts to ensure the volatility of the market is better balanced along the supply chain.

This week UDV and ADF met with farmers in South West Victoria – to hear concerns, answer questions and build feedback about the current supply chain into our policy work. This is one of many meetings ADF will continue to participate in throughout the year, to ensure we are effectively representing farmers’ interests.

The discussion was robust. Overall, the consensus in the room was that trust has been broken and we need to find a way forward.

The challenges faced by farmers in Western Australia due to processor decisions reinforce the sector as a whole is enduring tough times – no state is immune.

Collaboration is what will get us to where we need to be. Our industry relies on all the elements to operate effectively. Farmers need processors and vice versa – so the solutions will require input from all parties.

Beyond this the public and the government ignore us if we do not operate as one. If we have a hung parliament, dairy will need parliamentary champions to advocate our policy priorities and the industry must work together to feed them that case.

David Basham

Acting ADF President

March 2016 President's Message

Apr 04, 2016

2016 is proving to be a challenging year for dairy farmers. Australian Dairy Farmers (ADF) recently visited members in New South Wales, South Australia and Western Australia, and across the country farmers are confronted with low milk prices, increased input costs, and dry weather conditions.

This continued volatility is a reminder of how dependent farming is on a lot of things which are outside our control.

Dairy farmers are realists and they are resilient business operators. Adaptability has become critical to successful dairy business ventures. Realistic solutions frequently involve working to address the issues we can control, while also accepting that some things are outside our reach. What those solutions look like will differ from one business to another.
 
The Sustainable Farm Profitability Report produced by the Australian Dairy Industry Council and Dairy Australia last year provides some useful tactical management advice to help safeguard businesses during this challenging period.
 
Through our discussions with both State and Federal Governments ADF continues to advocate for a more competitive business environment, and ensure access to the resources essential to dairying. Dairy industry advocacy has seen vital progress of late with the introduction of an ‘effects test’ as well as a review of the proposed ‘backpacker tax’ and bringing in more flexible water policy. These are important achievements that will help deliver a more profitable and sustainable industry in the long term.
 
Dairy Australia also has important resources to assist in preparation and recovery from different conditions. Services provided by programs such as the Tactics for Tight Times provide a good vehicle for analysing the individual business and developing solutions.
 
Integral to this future is ensuring we protect what matters, by working to safeguard the health and wellbeing of our workforce. In recent meetings, both processors and farmers have highlighted this issue as crucial to the future of our industry. I look forward to identifying ways in which our industry can support our people’s physical and mental wellbeing with many of you at the Australian Dairy Industry Council’s Business Breakfast in April.
 
With the ongoing challenges our industry faces exacerbated by drought and tough seasonal conditions, I encourage you all to look out for one another and provide assistance where you can.

 

Simone Jolliffe

ADF President

An exciting leadership development opportunity awaits…

Mar 10, 2016

Looking for a way to build your leadership capabilities in preparation for further involvement with the industry, and your community? The Emerging Dairy Leaders Program (EDLP) could be the perfect opportunity for you.

The recently announced EDLP provides an outstanding opportunity for potential and current leaders across the sector to build their leadership skills and capacity to contribute to development of the Australian dairy community.

Australian Dairy Farmers and Dairy Australia have established the program to invest in the development of the industry’s people by further expanding on existing leadership programs available. 

The program will run over the course of a year, commencing April 26 and concluding April 2017 in Adelaide. The aim of the EDLP is to help emerging leaders to better understand themselves and others and therefore how to improve their communication skills and teamwork.

The program will feature a variety of learning and networking opportunities—including exposure to leaders and experts as well as challenging assignments. This provides a rich development experience with long-lasting practical outcomes for participants and the community.

Participants in the program will earn a Diploma of Agribusiness Management from the National Centre for Dairy Education/TAFESA using a variety of learning tools such as online self-paced study, webinars, peer discussion, workplace and mentor discussions. The EDLP participants will also be eligible to take part in the Developing Dairy Leaders Program afterward if interested.

All costs associated with education enrollment, travel, accommodation and meals while away from home will be covered by the program.

To apply or for further information head to the People in Dairy website or contract Program Coordinator, Karen Conrad via 0488 099 891. Applications open on Thursday 10 March 2016 and close on Monday 28 March 2016. 

 

 

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