What We Really Need Now

Aug 19, 2016

The Four Corners ‘Milked Dry’ program aired Monday 15th and highlighted the financial toll that cheap dairy products and fluctuations in both the domestic and global markets have taken on dairy farmers. This state of crisis has also shown just how far consumers will rally to help our struggling industry, but it will only solve half the problem.

What we really need now is to go beyond short term measures to create stability for our industry’s long term future. The need for transparency and improved fairness by finding new ways to manage price volatility for farmers; and through simplifying supply contracts so farmers know exactly what it means and how it will affect them.

The first in a series of formal talks with the dairy industry, the Prime Minister Malcom Turnball, Deputy Prime Minister Barnaby Joyce and representatives of Murray Goulburn met to discuss ways to increase the profitability of the Australian dairy industry in order to support farming families and their communities. An important thing to take away from this meeting is the fact that the Australian Government and Murray Goulburn both agreed that Australia’s dairy farmers deserve fair returns at the farm gate, as well as transparency in milk price arrangements and supply contracts. Another important outcome was the role Murray Goulburn will play in explaining to their suppliers what steps they will take to support farmers and restore confidence to the dairy sector.

We expect a similar message and outcome of next week’s meeting between Fonterra’s Australian management and the Government who will continue to discuss the state of the dairy industry and how the current issues could be avoided in the future.

The last in the series of talks is the dairy symposium to be held in Melbourne on August 25, chaired by Minister Joyce with representatives from the farming, processing and retail sectors. We will be asking the government to formally review a number of high priority issues including $1 milk, fair contract terms and conditions, and a world dairy commodity pricing index.

At ADF, we are working closely with state members and dairy farmer representatives to make sure the government continues to strengthen the industry through consultation with both Australia’s dairy farmers and processors. We are committed to provide innovative and practical solutions to help farmers achieve a sustainable level of profitability and ensure that our farmers’ best interests are reflected in the work we do so they can take control of their situation and make informed choices.

One of the ways the government is helping dairy farmers is by providing assistance through a $579 million support package. This package includes access to Dairy Recovery Concessional Loans, Farm Household Allowance (FHA), the Rural Financial Counselling Service and an additional $900,000 for Dairy Australia to roll out ‘Tactics for Tight Times’ one-to-one farm business advice.

The government support package is there to help us through this difficult time. It is very important that dairy farmers, including farm owners, share-farmers or leasers not self-assess their eligibility for government assistance. If you have any questions relating to whether you are eligible for the concessional loans, please contact a financial counsellor or the relevant state delivery agency as they will be able to help you with information and the application process.

David Basham

Acting ADF President  


 

 

Its Time To Stand Together

Aug 15, 2016

Most of you are aware the Four Corners ‘Milked Dry’ segment will go to air tonight, Monday 15th August, which is a follow-on from the dairy price cuts that happened a few months ago.

As a Dairy farmer, we know the industry is not immune to the volatility of milk prices and as history has shown the prices will probably continue to fluctuate well into the future.

What the majority of the public don’t see is how resilient we are. Not just as farmers, but as business people, as entrepreneurs and experts in sustainability, with the skills to adapt our businesses within this challenging environment as best we can.

Behind the scenes, the Dairy industry are working together to provide farmers with the support they need during this challenging time. As an industry, we are united in going beyond short term measures to create stability for our industry’s long term future.

An important aspect of this is the need for transparency and improved fairness by finding new ways to manage price volatility for farmers. We are working to address these issues through simplifying supply contracts and improving transparency in the milk pricing system.

The ADF is pleased that the Hon Barnaby Joyce MP is proceeding to hold a Symposium with farmers, manufactures and retailers. The ADF will provide strong dairy farmer representation regarding the major issues we face including $ milk, fair contract terms and conditions, and a world dairy commodity pricing index which are just a few of the high priority issues.

There are unfortunately no silver bullets to restore our industry, but there are resources available to help farmers navigate the current challenges and manage the impact of recent announcements. This includes the Tactics for Tight Times program, which helps provide clarity to farmers about settings and seasonal conditions, supports key decision making on farms, and put farmers directly in touch with other services such as health and wellbeing organisations. It’s important to make the time to take up these opportunities.

While being put in the spotlight can sometimes feel overwhelming, the media is a great vehicle to share our message with the public to let them know what is happening and ways they can help. It is also a chance for state organisations and dairy farmers to let consumers know that they can show their appreciation and support by buying Australian milk and dairy products.

David Basham

Acting ADF President


 

With the election over, it's time to get things done

Jul 15, 2016

After ten days of vote counting, this week Australian Dairy Farmers (ADF) congratulates the Coalition Government on its re-election.

As an industry, dairy has enjoyed a constructive relationship with the Coalition throughout its previous term, and we look forward to continuing that spirit of this engagement.

With the election behind us, promises made can now be translated into concrete action.

Although the ministry will not be sworn in until next week, ADF has already met with the Department of Agriculture’s advisors to progress the roll out of key support measures announced in the Dairy Support Package. In particular we continue to highlight the urgency in providing immediate access for all affected farmers to Concessional Loans and the Farm Household Allowance support.

Importantly, concerns raised by farmers who have been working to access these measures, including by share farmers, are being taken seriously and will continue to be progressed with the government.

We will continue to work with the Coalition and the opposition to address other key priorities for the dairy industry also, including implementing an effects test to better balance market power throughout the supply chain, invest in rural research and development to build resilience, ensure secure access to sustainable water resources and support a national strategy to address technical barriers to trade.

Over the coming weeks, the ADF policy advisory groups will continue to meet in Melbourne to cement our priorities for the new government. Building industry resilience, as well as addressing the lack of transparency throughout the supply chain are on our agenda.

July has begun the same way June came to an end - with wild weather and floods challenging many dairying regions and low milk prices meaning revised budgets and planning across all farms.

As we work together to weather these storms we must remember that we are a resilient industry with a long, sustainable future ahead. Our profitability and therefore resilience as an industry depends greatly on the support of the Australian public.

We must continue to remind the community that dairy farmers – regardless of the challenges they face are good business people, who care for their cows, work to enhance the wellbeing of their people and that every efficiency we make on farm has ties to minimising our impact of the environment.

David Basham

Acting ADF President

June President's Message

Jun 30, 2016

Opening milk price announcements made this week by Murray Goulburn and Fonterra have once again, reinforced the need for improved transparency in the way milk pricing is structured and communicated in Australia.

Not only are the announcements much too late for farmers to properly budget and plan around, but many questions have to be asked to understand them. Add to the already complex system a loan repayment and the forecast opening price is far from what it first appears.

Both Murray Goulburn and Fonterra’s recent announcements are confusing and difficult to understand – they lack clarity and transparency.

Murray Goulburn’s repayment system is complex at best. Further, the exact amount that farmers will repay by the end of the financial year 2016-17 is not articulated in the announcement – nor is it clear that farmers will actually pay an initial repayment of 14 cents per kg/ms plus any further repayments Murray Goulburn decide to deduct.
 
Fonterra’s announced opening price of $4.75kg/ms was better than expected, however the detail around who received what is not clear. Existing Fonterra suppliers will receive around $4.75 ($4.73 due to interest on the loans). Any supplier who did not supply Fonterra milk in May-June (including farmers that had dried off) are not eligible for the Autumn offset and therefore receive around $4.54.  
 
We shouldn’t have to ask to get this information – it should be clear as day. After all farmers are providing the very lifeblood of these organisations, it’s in everyone’s best interests that we get this information up front and can work within these means. 

Improving the transparency of the milk pricing system is important, and Australian Dairy Farmers (ADF) continues to work with our state members to this end. It is essential that processors come to the table and discuss this as a collective, to help protect the future of our sector.

No one can dispute that the current market situation for dairy farmers, whether you are a supplier to the export or domestic market, is rough. Even the best placed businesses will be making difficult decisions.

While we cannot change the milk price, ADF is working hard with our state members to improve the transparency in the milk pricing system and simplify milk contracts. We are also fighting for farmers to better manage the risk throughout the supply chain so that they do not always bear the financial risk.

This weekend Australia takes to the polls and by next week the successful party will be moving into Parliament. ADF and our state members will be back in Canberra as soon as the elected party is announced to keep the pressure on.

As an industry dairy has supported its own and will continue to do so. We’ve never asked for a bail out but rather for targeted assistance that will help get our industry over the current hurdle and better balance risk throughout the supply chain going forward. We need structural change that improves fairness and brings more balance into the market – competition law can be improved more.

ADF acknowledges the Dairy Recovery Concessional Loans are now available in SA, TAS and Victoria. We welcome this support, and will continue to advocate that all affected dairy workers are eligible for this assistance. 

I encourage all farmers to keep talking to ADF, your state representatives and RDPs. It’s tough for everyone out there right now, and the season ahead will be challenging. This will go beyond the farm gate, with our service providers and communities likely to feel the pinch too – keep this in mind and let’s all look out for one another.

David Basham 

Acting ADF President

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