Farmers warn milk change could go sour

LABOR’S plan to introduce a set minimum farmgate milk price could leave the dairy industry worse off, farmers say.

Labor leader Bill Shorten will ask the Australian Competition and Consumer Commission to look at ways to set a floor price for milk if the party wins the federal election, expected in May.

The move follows supermarket giant Woolworths abandoning its $1-a-litre milk campaign, lifting prices to $1.10 a litre.

While Labor’s recognition that the industry needs help has been welcomed, some farmers worry about a return to a regulated dairy industry, a system that was discarded two decades ago.

Tasmanian Farmers and Graziers Association dairy council chairman Andrew Lester said a minimum milk price would not be a silver bullet. “When we moved through the deregulation process we took money to deregulate on the proviso that it wasn’t to be regulated again, so there could be some ethical considerations,” he said.

“As an industry, we need to look at all options, but people need to realise it may not be the saviour they hope it will be.”

In contrast to many dairying regions in Australia, Tasmania’s milk production has steadily increased.

Merseylea dairy farmer Luke Bloomfield said the huge variation in production costs between regions across the country would make it hard to set a floor price.

“There’s a lot of questions about this, and it’s all very well to make flippant statements, but the fact is, we’re playing in a global market,” he said.

“How is the Government going to dictate to these companies what they’re going to pay when a lot depends on what’s happening in other countries?”

Mr Bloomfield said Woolworths’ move was a “step in the right direction”, but fresh milk was only a part of the industry.

Coles is sticking with its $1-alitre milk, saying it is already helping farmers through donations collected at its stores.