Unprecedented times calls for unprecedented response

May 27, 2016


The dairy market shock is the result of unprecedented circumstances, and they require an unprecedented response from our industry.

In a leadership collaboration with our state members , we have driven positive policy responses and commitments from the Commonwealth and State Governments in Victoria, Tasmania and South Australia.

Australian Dairy Farmers (ADF) have strongly advocated the Commonwealth for immediate solutions to help farmers, who have been placed in an extremely difficult situation by the actions of these processors.

We believe these Government responses are broadly positive and reflect the immediate needs of the most affected dairy farmers, but we also need to understand more detail before we can effectively endorse them as being of most value to dairy farming businesses.

ADF sought interest rate assistance for farmers from the Commonwealth and we believe the adapted concessional loan scheme for dairy farmers flagged by Agriculture Minister Barnaby Joyce will help address this need.

But we do need more urgency in implementation to support continuity for many farmers.

More resources for Rural Financial Counselling is a significant gain and will help to ensure dairy farmers are making decisions based on the best available and most accurate information about their business.

Further support for Dairy Australia’s Tactics For Tight Times initiative and streamlined access to various Government services will also directly benefit farm businesses.

However, we will continue to press for exceptional circumstance recovery grants and to ensure all assistance measures are available to all dairy farmers.

While we understand and support the intent of the proposed dairy price index, we have concerns about how this will work in practice.

And in the dry conditions affecting much of Australia’s dairy production zone, we will continue to press for the release of Commonwealth-owned environmental water.

While we must manage the here and now, our attention is also looking to the longer-term, to better manage volatility and safeguard the future of our industry.

ADF has always advocated that there needs to be a better balance between retailers, processors and farmers.

We continue to pursue processors and governments to ensure milk agreements from 1 July are more equitable, more fair and more transparent for farmers. Equitable competition policy is essential to achieving a better in risk between supplier, retailer and processor.

ADF is calling for:

  • All political parties to support an Effects Test in section 46 of the Competition and Consumer Act to assist the ACCC in taking a longer term view of issues and discovering the true impact for consumers, farmers and others of strategies undertaken by those with significant market power.
  • Higher penalties and harsher remedies are necessary to deter and reprimand those who misuse market power. Applying a legislated base fine that is a significant percentage of the revenue derived from the sales affected by anti-competitive behaviour is warranted.
  • That the Federal Treasurer give direction to the ACCC to undertake an immediate investigation of the pricing of milk at $1 per litre for a potential breach of section 46, of the Competition and Consumer Act 2010 in relation to predatory pricing, particularly in regional and remote areas.
  • It is important in any commercial relationship that acceptable and ethical business be promoted and undertaken. It is ADF’s belief that enacting a statutory duty of good faith in the Competition and Consumer Act will assist in ensuring this takes place. ADF understands that recent case law has provided a framework upon which a statutory duty of good faith could be based.

Dairy farmers are not asking for a return to past days of a highly-regulated market, and they are not asking for consumers to be punished with a tax as proposed by some on the fringe of our industry.

Our industry is resilient, we know about volatility, and with the right support we will be better positioned to manage for long-term profitability and productivity.

David Basham

ADF President

 

February President's Message

Feb 29, 2016

There has been a lot of discussion about investment for a stronger future this month, with a great deal of excitement generated by recent investments in Australian dairy.

Such investment will have positive impacts for farming communities.Investors may be interested in further value added opportunities for milk processing. This could be a generator of new growth and development for the whole industry. Investment that passes our foreign investment regulatory tests continue to the benefit of Australian dairy.

Importantly, our industry recognises that this stronger future depends equally on economic, environmental and social outcomes. Dairy continues to hold itself accountable by not waiting for change to occur, but by initiating positive change ourselves. The industry’s progress is highlighted by the Sustainability Framework’s 2015 Progress Report – set to be released shortly via www.sustainabledairyoz.com.au.

It was my great pleasure to discuss the industry’s performance against the key targets with the Department of Agriculture and Water Resources in late February at the Canberra Dairy Forum, and to share more about our industry’s commitment to retaining our social licence to operate.

I encourage you all to take a look at the Progress Report when it is released in mid-march and provide feedback.

Part of tackling sustainability challenges and helping the industry demonstrate performance to the Australian community, is investing in agile representative structures. On the heels of a period of significant policy achievement, ADF is in the strongest position it has ever been. Much of this we owe to our 2012 restructure which helped build greater transparency and engagement with key stakeholders, particularly decision makers in government.

We recognise that there is room to further improve our representative models, to ensure that we can continue to effectively advocate on behalf of all dairy farmers in all dairying regions. The proposed National Farmers’ Federation’s restructure has begun this conversation and ADF looks forward to furthering this discussion to ensure dairy representation has a future that maintains currency, relevance and accountability.

Simone Jolliffe

ADF President

January 2016 President's Message

Jan 25, 2016

Welcome to the New Year. I hope you have all had the chance for a short break at least, and are ready to work together to tackle the challenges and opportunities that 2016 brings.

In recent years, Australian Dairy Farmers (ADF) has strengthened dairy’s ties with Canberra to raise the profile of the issues that matter most to our farmers. ADF has maintained our reputation of acting apolitically, being accessible to all politicians, and being willing to listen.

This year we will continue to build this profile, while simultaneously building on our capacity to deliver value to members.

So far in 2016, key members of the ADF team have visited members in central New South Wales. In February our CEO will visit Western Australia – to talk and listen about priorities for the year ahead. These are the first of many 2016 interstate meetings to follow.

I encourage you to take the opportunity and introduce yourself to our team. The passion and commitment that the ADF staff has to help achieve a stronger future for our industry is evident, and we are all prepared to listen to your thoughts, ideas and constructive feedback.

The beginning of the year has been challenging for farmers. Extreme weather conditions brought drought or very dry conditions in Tasmania, West Victoria, South Australia as well as savage bushfires in Western Australia. ADF is seeking to assist its state members with recovery efforts. I commend the efforts of WA Farmers, Western Dairy and Dairy Australia, in providing practical support and counsel to the affected farmers in WA.

Events like these are a timely reminder that so many aspects of our business are affected by elements beyond our control. ADF is committed to ensure that farmers have the information and resources they need to take control of what they can. Dairy Australia also has a great resource of tools and information to assist in preparation and recovery.

In February, ADF will host an environmental scanning and industry planning workshop with key stakeholders such as our state members and Dairy Australia. These sessions will aid in setting our advocacy priorities for 2016, to establish a sound policy platform which ensures we can capitalise upon growth opportunities delivered by 2015’s advocacy.

I look forward to getting out and about in order to meet with as many members and non-members as possible over the course of 2016 to ensure ADF can continue to deliver value for the industry.

Simone Jolliffe

ADF President

August President's Message

Aug 18, 2015

The Australian dairy industry has historically managed price volatility, global supply and demand issues and the fluctuations of the Australian dollar to good effect, maintaining international competitiveness, innovation and resilience to market volatility.

While we’re in volatile times, there is a lot more to be factored into the market in the next few months. Rather than panic, we need to ensure we are prepared for the short term difficulties facing us and remember that the long-term outlook for dairy is positive, despite current market volatility.

 

Industry needs to work to its strengths as a cost-efficient milk producer of quality dairy products in order to face the expected challenges. Within the industry there are considerable resources and work being applied to help dairy farmers confront the volatility challenge. Australian Dairy Farmers (ADF) is working in partnership across the industry and with government to undertake work and analysis to support Australian dairy farmers in their decision making.

It is reasonable to ask why up until now the Australian dairy industry has not been affected to the same degree as New Zealand. Unlike New Zealand Australia has more the 50 percent of its production consumed domestically. This provides a dampening effect on the downward trend of international markets on farm gate pricing. Our product mix has also allowed for the pricing trends to be less severe. However, there is no doubt that this international pricing impact is placing downward pressure on expected farm gate pricing that was not even seen two to three months ago.

Those farmers who supply processors that are uncontracted and exposed to world export pricing should treat the 2015/16 season with a significant amount of caution, understanding their underlying costs and being aware of input costs which will affect profitability.

Whether you’re a farmer, state organisation or peak body, we are all striving for the same outcome – a healthy and sustainable dairy industry. Industry projects such as the Sustainability Framework and the Australian Dairy Vision help provide a strategy for ADF’s efforts. On this note, it is with great pleasure that I welcome Benjamin Stapley as incoming Chief Executive Officer (CEO) of ADF. With a strong background in member advocacy, stakeholder engagement, policy development and media management, Mr Stapley comes into the role after two years as Director of Policy and Regulation at the Plastics and Chemicals Industries Association (PACIA).

I look forward to the fresh perspective and expertise that Ben brings to the role and along with my fellow Directors, National Council and staff look forward to working with him to continually improve the sustainability and profitability of farmers across all dairying regions. I hope you will all join me in welcoming Ben to our dynamic industry when he commences as CEO on 1 September 2015.  

Noel Campbell

ADF President

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