Important Outcomes From The Symposium

Aug 26, 2016

The symposium was held yesterday in Melbourne and both the Australian Dairy Farmers CEO John McQueen and myself attended.

Firstly, I would like to thank the Deputy Prime Minister and Minister for Agriculture and Water Resources, Barnaby Joyce for organising and chairing the symposium as well as other government officials who were in attendance.

I would also like to thank our state members - QDO, NSWFarmers, SADA, TFGA, UDV, WAFarmers and industry partners for their work prior to the symposium which gave us the opportunity to narrow our message down to focus on four important key areas.

Lastly I would like to thank the processors and retailers who were at the symposium to hear from concerned farmers, owners of small businesses and people who produce a quality product that many people in Australia rely on.

For me, the symposium provided an opportunity for the dairy industry to have an open discussion with key stakeholders to address the challenges facing the Australian dairy industry.

Our main points include no $1 milk, no late season drop in milk price, fairer contracts, commodity milk price index with an educational program and critical need for farmers and manufacturers to find the solutions rather than depend on government.

These points illustrate the need by industry to ease the pressure placed on farmers by having to accept an unfair share of the risk and possible financial fall-out. We believe in greater transparency and look forward to working with the government on establishing the commodity price index tool which will help tip the balance back to the farmer.

Since 2011, we have said that the $1 milk devalues the product by taking substantial value out of the supply chain and has to stop if we are going to maintain a sustainable industry. There needs to be greater fairness in contracts and we have committed to working with processors to ensure all contracts comply with the unfair Contracts Legislation that begins on November 12, 2016. Also, the situation in Western Australia needs to be addressed immediately as we don’t believe it’s right that nine farmers may not have anywhere to take their milk.

In response, Minister Joyce urges the need for industry to work together to better balance risk along the dairy supply chain, especially when it comes to managing the effects of lower world prices. He wants to see improved Farmgate returns for dairy farmers, an openness in milk price arrangements and fair and transparent milk supply contracts; plus, the development of a commodity milk price index which he committed up to $2 million in government funding to establish. Also, for industry to find a compromise to the $1 milk situation otherwise he will need to take action and push for an immediate solution.

However, he also acknowledged that these things will only happen if there is buy-in from industry and a willingness from key stakeholders to hear each other out and develop solutions together.

A surprise announcement made by Minister Joyce at the conclusion of the symposium advised that Treasurer Scott Morrison has request the ACCC to undertake an inquiry under Part VIIA of the Competition and Consumer Act 2010 providing the Commission with powers to obtain information from the entire value chain. What this means is the ACCC has been given extra investigatory powers to undertake the inquiry, with the authority to dig deeper than it would have been able to in a market study. The inquiry, which will begin in November, will investigate sharing risk along the supply chain, supply agreements and contracts, competition, bargaining and trading practices in the industry and the effect of world retail prices on profitability.

Yesterday’s dairy symposium delivered on Minister Joyce’s election promise to get key stakeholders together to address challenges facing the Australian dairy industry and discuss ways to improve the industry’s prospects going forward.

One of the ways the Coalition Government is delivering assistance to dairy farmers is with a $579 million support package to help manage through the current low price environment. The funding been allocated to four main areas including 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.

If you have any questions relating to whether you are eligible for the concessional loans, the government has released a dairy question and answer section on their website (click here). However, we suggest that you also 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


 

 

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


 

Coalition Continues Support for Australian Dairy Farmers

Aug 08, 2016

The ADF has heard from Minister Joyce that he will be convening a symposium on dairy issues as part of the Coalitions election commitments. The ADF will be working hard with state organisation members over the next few weeks to prepare for the Symposium.

We expect it will provide an opportunity to discuss the major issues facing the industry including $ milk, fair contract terms and conditions, a world dairy commodity pricing index, issues in WA where some farmers have been given notice of not being picked up and backpacker tax, to name a few of the high priority issues.

While we have welcomed the Governments support package we continue to urge changes to the criteria for access to most elements of the Governments support package, particularly the concessional loans package.

The plan announced in the lead up to the 2016 election, included $555 million in concessional loans with 10-year loan terms, $20 million for an upgrade to Gippsland irrigation infrastructure, $2 million to establish a commodity milk price index and $1.8 million to provide business and financial counselling.

I urge all farmers to not self-assess whether they are eligible for the concessional loans support package. We know many have had difficulty with access and we have been able to use some of these experiences in our ongoing discussions with the Department for changes to the eligibility criteria.

The Prime Minister and Deputy Prime Minister will be meeting with the Murray Goulburn Board to discuss the global and domestic challenges facing Australian dairy farmers. It will be interesting to hear the outcome of this meeting. Mr. Joyce will then convene the dairy farmer symposium with the Department of Agriculture and Water Resources

The ongoing support and commitment of government is essential for us to successfully navigate through these trying times so we are able to provide innovative and practical solutions to help farmers achieve a sustainable level of profitability. We need to ensure that the solutions we present are in our farmers’ best interests, so they can take control of their situation and make informed choices.

ADF thanks Barnaby Joyce for maintaining this election promise and his continued commitment to seeking solutions to the current dairy situation.

David Basham

Acting ADF President


 

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