Step-downs, claw-backs and a fair price

Shepparton News - Country News - - NEWS -

With anger still seething from the 2016 milk price claw-back, it was no sur­prise that step-downs dom­i­nated the conversation at a con­sul­ta­tion meet­ing about the manda­tory code of con­duct in Shep­par­ton last Tues­day.

With all op­tions on the ta­ble, the 40-strong crowd were pressed on their pref­er­ence for whether a code should out­law step-downs all to­gether, or al­low a ‘get out of jail’ step-down for ex­treme in­stances — such as the Global Fi­nan­cial Cri­sis.

Run by the Fed­eral Depart­ment of Agri­cul­ture and Water Re­sources, the fa­cil­i­ta­tor of the meet­ing cau­tioned that out­law­ing step-downs could re­sult in a more con­ser­va­tive open­ing price and, if a re­peat of the GFC oc­curred, the law wouldn’t al­low pro­ces­sors to re­duce their milk price, forc­ing them to shut their doors and leave many dairy farm­ers look­ing for a home.

‘‘We’re still stuck in a mind­set and try­ing to guess what the fu­ture might be like,’’ Katunga dairy farmer Daryl Hoey said.

For Katunga dairy farmer Brid­get Goulding, it ul­ti­mately comes down to dairy com­pa­nies of­fer­ing a fair price, calling on pro­ces­sors to ‘‘be­have’’.

Con­cerns were only fur­ther ex­ac­er­bated by the ques­tion of who would have to pay for the im­ple­men­ta­tion of the manda­tory code of con­duct.

Although costs are ex­pected to be min­i­mal, a price tag has yet to be put on the po­ten­tial code.

‘‘This is all be­cause Mur­ray Goul­burn and Fon­terra did what they did . . . Are farm­ers go­ing to have to foot the bill (for the code)?’’ Ms Goulding ques­tioned.

The lack of clar­ity sur­round­ing what a code will en­tail and the spe­cific is­sues — in­clud­ing the pos­si­bil­ity of not re­quir­ing ex­clu­sive sup­ply un­der a stan­dard con­tract, im­ple­ment­ing cool­ing-off pe­ri­ods if step-downs are put in place and po­ten­tial ex­emp­tions and penal­ties — all con­tin­ued to be ques­tion marks for many in the room.

The ac­ces­si­bil­ity and costs of set­tling con­tract dis­pute through dis­pute res­o­lu­tion meth­ods were also a point of con­cern.

Un­der the Hor­ti­cul­ture Code, the cost of en­ter­ing into dis­pute res­o­lu­tion is as much as $330/hour, a fig­ure farm­ers said could not af­ford to be repli­cated un­der the dairy code.

‘‘It’s more money that farm­ers lit­er­ally can’t come up with,’’ Ms Goulding said.

Ul­ti­mately, farm­ers said they could of­fer lit­tle in the way of sug­ges­tions or ad­vice mov­ing for­ward with­out a draft doc­u­ment to work off.

‘‘This has been com­pletely and ut­terly rushed and is just a brain fart,’’ Co­bram East dairy farmer Paul Mundy told the room.

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