Woolworths has announced a second 10-cent levy on the retail price of its own brand of milk just days after ALDI did the same.
ALDI announced its move on Wednesday, with Woolworths following suit on Friday and upping the price of its two-litre milk to $2.39 and three litres to $3.59.
The two supermarkets, along with Coles, abolished the $1 per litre price point on their respective home-branded milks in March in favour of struggling dairy farmers.
But Coles has not indicated any intention to match the new price increase.
Meanwhile Woolworths has assured its customers the additional 10 cents they’ll pay for milk will be passed straight onto dairy farmers.
“Independent auditors will verify the distribution of funds so we can ensure every cent makes its way back to Australian dairy farmers in full,” the store’s website said.
ALDI said the price change followed negotiations between its milk suppliers and dairy farmers, saying it was necessary in “building a long term sustainable Australian dairy industry”.
The supermarket said it would continue to “maintain the collection and distribution of 10 cents per litre implemented earlier this year”, but made no mention of the new price increase.
Dairy Connect, a NSW lobby group, said it was important an increase in retail price was passed back to dairy farmers.
“It's great to see a major supermarket recognise its price has been too low but it's important that as much as possible of that increase flows through to the farm,” chief executive Shaughn Morgan told Farm Online.
“The retailer, processors and farmer all need to be successful because there is a risk that, unless that happens, Australian consumers will be drinking imported milk.”
Mr Morgan urged Coles to follow its competitors and raise the price of its milk.
Dairy Connect chairman Graham Forbes echoed the call, but said the industry was still a long way from being sustainable in the longer term.
“I think a lot of people would like to see [the rises] continue and get up around $1.50 a litre where all sectors of the industry could survive and be sustainable,” Mr Forbes told ABC News.
“We need all three, the farmers the retailers, and the processors to be profitable, and we certainly need more movement to allow that to happen properly.”
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