Fresh milk will disappear from supermarket shelves if dairy farmers aren’t treated fairly, says the Vasse president of WA Farmers.
Greg Chapman warned consumers “will be drinking UHT from anywhere” if Coles doesn’t end its $1 milk campaign.
A joint-commissioned sustainable milk price report by WA Farmers and the Dairy Collective Bargaining Group released this month reveals farmers were cutting back on labour and selling their assets to survive, after the farm gate price of milk sunk to 40-42.5c/l last financial year.
Mr Chapman said milk production in WA had continued to decline and farmers were sick of working for nothing.
“We can’t take much more,” he said.
“Either farmers get more money in their pocket so they can afford good labour and put the pressure off, or they leave the industry.”
WA Farmers will take the report to Coles owner Wesfarmers and milk processors to try to forge a way forward. Mr Chapman said it was up to consumers to decide if they want fresh milk in WA or not.
This month Coles shoppers in Busselton told the Times they would pay more for milk if it helped farmers, but some said they could not afford to.
Coles corporate affairs general manager Robert Hadler said the supermarket paid a commercial price to diary processors and did not deal directly with dairy farmers.
“We pay our dairy processor more than the break-even point in the WA Farmers report,” he said.
“We also inserted rise and fall clauses in our contracts so if farm gate prices rise, we pay our dairy processors more.
“This protects the dairy farmer as much as we can. Dairy farmers’ margins are influenced by many factors, including input costs, which are totally out of the control of Coles.”
Mr Hadler said customer demand for $1 milk had increased production but shoppers could buy branded milk if they wanted.
Busselton dairy farmer Oscar Negus claimed $1 milk was a marketing ploy to attract shoppers and processors had no choice but to pass on the loss to dairy farmers.