eastAUSmilk - time for member’s involvement
The first anniversary of the amalgamation of Queensland Dairyfarmers Organisation and Dairy Connect in forming 'eastAUSmilk' occurs on 1 December.
It has been an exciting 12 months under the guidance of Matt Trace and the members of the interim board and interim district councils.
The values that underpinns the organisation, as highlighted by the 'AUS' in the name, being 'Advocacy, Unity and Service', have provided a positive and collaborative way in bringing together dairy farmers from two states under one umbrella.
As has been said, unity of numbers and unity of purpose provides the foundations of a strong and united organisation enabling it to effectively advocate before government and other stakeholders within the dairy value chain.
With the terms of the current members of the interim board and district councils coming to an end on 31 December, eligible members of eastAUSmilk are encouraged to consider standing for their district council and/or for the board.
Nominations are now being received until Sunday 13 November and you may obtain a nomination form for your district council and/or for the board from Lynelle Rogers by emailing her on ea@eastausmilk.org.au or by phone (07) 3236 2955. Alternatively, you may download the nomination form(s) from the eastAUSmilk website at https://www.eastausmilk.org.au/board-and-district-councillor-nomination-forms
If more nominations are received than positions available in either the district councils or the board, then elections will be held to determine those who will be elected.
The board of the eastAUSmilk recently amended the boundaries of the 6 District Councils to ensure inclusivity of the members within the two States, which are now:
• the Northern – Central Qld District;
• the Burnett - Gympie - Moreton Qld District;
• the Scenic Rim – Lockyer Valley Qld District;
• the Darling Downs Qld District;
• the Northern NSW District (North Coast - Mid North Coast – Lismore - North Inland); and
• the Southern NSW District (South Coast - Sydney basin - Inland).
Involvement of the members in the democratic process of any industry association is vital for its well-being and corporate governance. I encourage you to consider becoming involved within your organisation.
If you have any questions, please feel free to contact your representative interim board member whose contact details may be found at the eastAUSmilk website or by contacting the office.
Shaughn Morgan, Co-CEO eastAUSmilk
Methane emissions - part of a bigger whole
The Australian dairy industry comprises a dairy herd of over 1.4 million cows, a workforce of over 43,000 and farm gate production valued at $4.8 billion.
In its 2021 report 'economic and broader contribution of the Australian dairy processing industry', Deloittes also estimated that dairy processors generate $15.7 billion in sales and support 70,000 full-time equivalent jobs.
The contribution of Australian dairy to the economic well-being of the nation is unquestioned.
The recent announcement by the New Zealand government to impose a 'fart tax' on livestock from 2025 may result in NZ beef and sheep production falling by 15% to 20%, with dairy declining by 5%.
NZ farmers have reacted by marching in the streets against this decision by their government.
Australian farmers were justly concerned.
Federal Minister for Agriculture Murray Watt consulted with peak agricultural bodies regarding Australia becoming a signatory to the global methane pledge to seek the aspirational collective non-binding goal, with 122 other countries, of reducing methane emissions by 30% by 2030.
Minister Watt stated that "the pledge does not require reduced herd sizes and (the government) will not legislate taxes or levies to reduce livestock emissions".
Peak bodies welcomed the Minister's pledge.
CEO of the Cattle Council, John McGoverine, stated that "millions in cattle levies have been invested in new feed additives that significantly reduce methane emissions including asparagopsis, or pink seaweed, which can cut emissions by more than 90%".
Australian dairy has also committed to reducing methane emissions.
Dairy Australia supports a 5 pronged approach on emission levels, including boosting diet quality; genetic improvement within cows; availability of better feeding for cows; improving a farmer's herd fertility and perfecting pastures.
Australian dairy farms are declining already. Any 'fart tax' would substantially increase the decline and any tax would be opposed by agricultural industry bodies.
Farmers need to be provided with incentives to reduce methane emissions not penalties as in New Zealand.
Rather government must improve resourcing for RD&E to find better ways to reduce emissions across all industry sectors, not just agriculture.
While the government's pledge is only an aspirational goal, it needs to be remembered that Australian food security and our economy depends on a strong agricultural sector. This should not be forgotten in future discussions.
Shaughn Morgan Co-CEO eastAUSmilk
Engagement - a key word
Any industry association is underpinned by its members and that the activities that the organisation undertakes on their behalf.
This can range from providing members services through to actively advocating for issues that impact decisively upon their industry or area of concern.
In the instance of eastAUSmilk, it is the coming together of the members from Queensland Dairyfarmers Organisation and NSW based Dairy Connect.
As eastAUSmilk nears the first anniversary of it becoming a united and dedicated fresh milk dairy farmer organisation, its ideals of Advocacy, Unity and Service are as relevant now as it was when it began its existence in December 2021, if not more so.
Yet, like any industry organisation, eastAUSmilk is only as strong as the members it represents. It must continue to rely upon the active and public involvement of its members in the role that it plays in representing their interests.
Seeking positive change through the development, implementation and advocacy of dairy policy is of paramount importance to ensure a strong, viable and sustainable fresh milk dairy industry into the future.
Ensuring a positive future for the next crop of dairy farmers.
This illustrates the purpose of eastAUSmilk. To provide a positive and seismic change in the way that we address the changes required and to make public the roadmap to reach its goal of a sustainable fresh milk industry in NSW and Queensland.
However, any agricultural industry body requires the support of the farmers that it represents as members provide the voice, direction and way in which dairy policy can be developed and implemented.
You need only look at its achievements in recent years with the demise of $1/L milk, the introduction of the Mandatory Dairy Code and bringing public awareness to 'truth in labelling'.
However, the issues continue.
The need for strong biosecurity protections to prevent the introduction and spread FMD and LSD; to ensure that appropriate safeguards are implemented to lessen the devastating impact of natural disasters such as floods and drought; ensuring the profitability of dairy farms and that a strong farmgate price is attained; developing a northern dairy industry plan with government and stakeholders to a fresh milk dairy future.
In early November, eastAUSmilk members will be receiving their notification for elections to district councils. These councils in turn provide the basis of the eastAUSmilk board.
This involvement by members ensures the strong platform for member interaction in all avenues of policy development and interaction. As I stated above, any industry organisation is only as strong as the members it represents.
I urge you to consider putting your name forward to serve your fellow dairy members and the dairy industry generally by standing for your regional district council.
Shaughn Morgan Co-CEO eastAUSmilk
Norco Ice Cream Factory Rebuild Great News for Lismore and Dairy Farmers
On 28 February 2022 the world changed for Lismore, but unfortunately in a devastatingly bad way. The biggest flood in history caused chaos for everyone including dairy farmers, businesses and residents alike. Almost everything was badly flooded and the devastation was heart breaking for all. 7 months later things are far from normal still. Most houses are inhabitable, and most businesses are not operational.
In the middle of this sits Norco, a dairy cooperative and the biggest employer in the Lismore region. Their head office and ice cream factory were flooded like everything else in Lismore. 7 months later their head office is getting closer to completion but the ice cream factory has been cleaned up and left dormant.
It was great news to hear this week that the ice cream factory will now be rebuilt thanks to $45.7m in funding from the federal government. Without this funding it would not have been commercially viable to rebuild the ice cream factory and I thank Minister Watt for ensuring this rebuild will become a reality.
The rebuild will allow many of the factory workers to remain employed and will help the rebuild in the devastated town of Lismore. The ice cream factory will also be a positive for Norco in diversifying income streams and increase profits. This should allow Norco to return extra money to its dairy farmer shareholders to drive further milk price increases to farmers and pay a sustainable price.
It is very positive to see Norco investing in the northern NSW and Queensland dairy industry. This will be a major manufacturing facility which is rare in the northern dairy industry. The factory will utilise some excess milk in spring and create additional demand for milk when there is too much to meet fresh bottled milk requirements.
Thank you to Minister Watt for securing funding to help the Norco ice cream factory to be rebuilt. I look forward to the construction going quickly and the factory being operational in the near future. This is a big win for both Lismore and dairy farmers which need positive news after the devastating year they have faced.
Eric Danzi Co-CEO eastAUSmilk
Falling milk production, declining dairy farmers - where to for Queensland?
The Australian dairy industry has seen a continued decline in the production of milk and this continued decline is showing no signs of abatement.
Dairy Australia, the dairy industry’s research and development corporation has stated that there was a 8.3% decrease in July. At the same time the year-to-date drop in NSW was negative 12.6% while Queensland was a negative 14.3% year-to-date.
The constant pressures being faced by dairy farmers are contributing to dairy farms being sold and farmers exiting the dairy industry or moving into other commodity groups such as beef.
In recent years, droughts and floods have been constant. Now the Bureau of Meteorology is predicting a strong chance of a third La Nina weather pattern adding to these woes.
Yet farmers generally and dairy farmers specifically remain eternally optimistic about the future of their farms and the communities that underpin them.
In September last year, the NSW Government released the NSW Dairy Industry Action Plan. The plan has put forward 28 recommendations to revitalise the NSW dairy industry over 4 themes.
Like NSW, Queensland dairy industry is in the process of developing a northern dairy industry plan which is intended to also revitalise the dairy industry in this state and return profitability and sustainability into the dairy industry.
This plan is intended to cover the subtropical region and is being driven by dairy industry advocacy body eastAUSmilk in consultation with Dairy Australia, Subtropical Dairy and dairy industry stakeholders including processors and the state government.
The draft terms of reference have been developed with Dairy Australia, Subtropical Dairy and supported by the eastAUSmilk board. It is intended to be overseen by a steering committee with an independent chair who has an understanding of the Queensland dairy industry.
The steering committee will establish a number of sub committees to consider issues such as pre farmgate competitiveness; market dynamics and opportunities; and the policy and enabling environment.
The failure to revitalise the Queensland dairy industry is not an option. Falling milk production and declining dairy farmer numbers must be halted.
The dairy industry players including advocacy body eastAUSmilk will assist in addressing those concerns and start that dialogue.
Shaughn Morgan, Co-CEO eastAUSmilk
More positive times for dairy industry
The dairy industry has had many tough times over recent years. There was the drought that kept going, followed by devastating floods, ongoing wet and muddy conditions, and a massive increase in the cost of inputs.
However, in recent months there have been some significant positives. Although there has been some rain, weather conditions have generally been better in most regions over recent months. Hopefully this continues and we have a normal wet season coming up.
The cost of inputs has stopped rising rapidly and have fallen for some inputs. The price of some inputs including urea increased again after falling considerably. Hopefully, we can see a steady fall in key inputs including fertiliser, fuel, and grain over the coming months.
The milk price increased substantially in July and most farmers would likely receive between 85c and $1 per litre this year. This is a historically very high milk price and with a softening in input costs would lead to decent profits for most farmers.
So, what has been the impact of the changes on dairy farmers? Some farmers have still ceased dairying in recent months but the mass exodus that we saw, especially during the drought, has ended.
There are an increasing number of farmers spending money on their farms given the more positive times currently and expected in the future. Some farmers are buying cows in an attempt to rebuild herds and increase milk production to take advantage of higher prices. There are an increasing number of farmers investing in capital on their farms both machinery and sheds.
Many farmers are investigating whether to make large changes to farm infrastructure to make their farms more resilient to future weather events (both flooding and droughts). This would be a very large capital investment for most farmers so many are wanting more certainty over future milk pricing before making such huge investments.
There are more positive signs for the industry. Most farmers want clear commitments from processors to increase milk prices to at least $1/L in the next year and maintain the 15C/L for new milk for at 3 years. These clear signals will be required for farmers to pull the trigger on substantial investments leading to large increases in production. I expect that the potential new entrants to the dairy industry are wanting the same before investing.
Eric Danzi, Co-CEO eastAUSmilk
Kay Tommerup appointed to QFF board
Kay Tommerup is a dairy farmer from the Beaudesert area who recently joined the board of eastAUSmilk. Kay has considerable skills in a range of areas which she has used to diversify her dairy farming business over the years with her husband David. The Board and senior management of eastAUSmilk believe Kay’s skills and enthusiasm would be useful not only for eastAUSmilk but also QFF (Queensland Farmer’s Federation). As such, eastAUSmilk has appointed Kay as our QFF nominated Director.
I fully expect that Kay will use her skills and experience to assist and lead QFF forward over the coming years. I expect all at QFF will value Kay’s input and inspire QFF to move forward as an organisation.
It is vitally important for QFF to work in partnership with government to achieve outcomes for farmers and government. Developing partnership programs with government is a key area that we need to further enhance to ensure that farmers flourish in the new world. I expect Kay to be of great value in developing and implementing these partnership programs in many areas including water, natural resource management and animal welfare. In addition, addressing government red tape restrictions on farmers and industry marketing are key skills of Kay’s that I expect to be utilised by QFF to help achieve outcomes for all farmers.
QFF undertakes a range of activities on behalf of eastAUSmilk and farmers which often go unrecognised. In addition to the key areas above, QFF is very active in a range of areas including water management and pricing, natural resource management, biosecurity, and labour.
Good luck to Kay in her new role. I look forward to watching her help lead QFF forward over the coming years to ensure that QFF delivers new and innovative outcomes for all QFF farmers.
Eric Danzi, Co-CEO eastAUSmilk
Milk comes from dairy cows not plants
Dairy farmers and their families are grateful for the ongoing strong support of Australian consumers for fresh nutritious milk, which is a staple of their food basket.
This is demonstrated by the continuing demand for fresh milk by supermarket customers.
Dairy Australia's Human Health and Nutrition Policy Manager, Melissa Cameron, in her recent presentation to the eastAUSmilk Annual Forum, indicated that 98% of households continue to regularly purchase milk.
She went on to say that 82% of households also agree that it's important to support the Aussie dairy industry.
Indeed, dairy milk provides 9 nutrients essential to human health.
Milk also contains other nutrients including B vitamins for energy, vitamin A to help maintain a healthy immune system and calcium and vitamin D, both of which work to build bone strength.
It is for these reasons that our peak advocacy body Australian Dairy Farmers (supported by the State Dairy Organisations and based on the empirical data and evidence provided by Dairy Australia) advocates for the importance of 'truth in labelling' in dairy produce.
Iconic dairy terms such as ‘milk’ should be safeguarded from misuse. This is especially so with the increasing acceptance of plant-based drinks as a 'milk substitute'.
Non-dairy alternatives generally had filtered water added to their plant base and were fortified with calcium and a range of other minerals and vitamins.
In some cases, key minerals and vitamins were not naturally present in these plant-sourced drinks. Nutrients were added to these products to try to mimic the composition of dairy milk.
Hence, the nutritional differences between dairy milk and plant-based alternatives are self-evident and 'truth in labelling' should occur now.
In the USA, the National Milk Producers’ Federation characterises such labelling as a misappropriation of ‘traditional dairy terms’ and says that ‘food labels should clearly and accurately identify the true nature of the food to the consumer’.
These non-dairy businesses should not be permitted to represent their products as something they are not.
Thus, the Government should act now to implement the many recommendations put forward over the past years and ensure that dairy milk is afforded the protection that the name 'milk' deserves.
Dairy farmers who work from before dawn to well after dusk each day deserve no less.
Shaughn Morgan, co-CEO eastAUSmilk
Annual Forum and Annual General Meeting 2022 - A Reflection
The Board and members of eastAUSmilk were grateful for the hospitality afforded to them by the people and dairy farmers of the Northern Rivers when the advocacy body held its recent Board Meeting, Annual Forum and Annual General Meeting in Lismore.
We were pleased to support the community as it continues its rebuilding of its township within its region, after the devastating impact of the floods.
The members were provided with 2 policy updates from experts in their fields on the preparedness to prevent foot and mouth disease and other biosecurity risks from reaching Australian shores (www.daf.engagementhub.com.au/animal-disease-preparedness) as well as the high nutritional value of dairy as against plant-based alternatives (www.dairy.com.au/health/nutrients).
Both presentations were well received, and copies of the speaker's PowerPoints may be obtained by emailing shaughn@eastausmilk.org.au
In 2 further addresses, the CEO of Norco, Michael Hampson, reflected upon the importance of collaboration within the dairy industry while CEO David Inall spoke about the activities of our peak industry body Australian Dairy Farmers.
The current Board also agreed to the timetable for the upcoming Board and District Councils to replace the interim members. Information will be made available in October for the nomination process and elections to be held so that the elected members can commence their tasks on 1 January 2023.
To stand for elected office, join eastAUSmilk and become an active member of your industry association. Further information regarding membership may be obtained from Lynelle at ea@eastausmilk.org.au
In his Presidential Address, Matt Trace, spoke about the positive messages from the FairGo Dairy Logo campaign within the dairy industry and the natural disasters that NSW and Queensland have encountered over the past 12 months.
The resilience of the agricultural sector to such adversity is to be applauded.
Expressions of thanks were also extended to former President (and current ADF Board member) Brian Tessmann as well as former Board members Joe Bradley and Gary Wenzel who all stepped down since the 2021 AGM.
The Board, District Councils and staff look forward to continuing to lobby and advance the cause of a strong, vibrant, and sustainable dairy industry in the northern States in the months and years ahead.
Shaughn Morgan, co-CEO eastAUSmilk
Feed in tariff need for ROI on solar for dairy
A dairy in the Lockyer Valley region, milking 250 cows, has implemented a photovoltaic (PV) system and management opportunity based on the energy audit report the farm received through the Energy Savers Plus Program Extension. Through the program the business site received a dairy shed energy audit carried out by AgVet Energy and an electrical site analysis performed by Solar Energy & Battery Storage Solutions (SEBSS) as well as an irrigation energy audit completed by The Energy Guys, all engaged by eastAUSmilk.
The goal of the business is to reduce electricity costs by implementing a PV System and making maximum use of the energy generated by the system to reduce energy imported by the grid.
Thanks to data provided by SEBSS performance monitoring of the Solar PV system, I was able to evaluate the savings and outcomes achieved from the farms investment.
Monitoring the farm energy use from June to August 2021 the load was 314 kWh/day with an average 271 kWh/day being supplied by the grid. With average grid supply cost of 20 c/kWh the 43 kWh being supplied by PV the system conservatively achieves a grid annual saving of $3,139.
As the business was on demand tariff 44 no income was being generated from the excess solar being fed into the grid. The business aims to move to a consumption tariff, so we explored the potential income from an expected feed in tariff of 7.84c/kWh.
With the average utilisation currently of 44% annually the PV system is expected to export 30,660 kWh. Potentially generating just over $2,400 per year.
With the increase of solar utilisation expected due to irrigation through summer the income generated through solar export will be reduced; however, this means the total business savings provided by the system will be higher as the export rate of 7.84 c/kWh is far less than the grid supply rate of 20 c/kWh. Provided that irrigation occurs during sunlight hours to make the most of the PV output.
The total expenditure invested by the business was $37,000. With over $3,000 in annual savings from reduced grid supply the calculated payback period of this investment is 11.78 years with a return on investment of 8.5%.
If the business is able to generate income from the PV export the total annual savings $5,542 would reduce the calculated payback period to 6.68 years with a return on investment of 15%.
Solar Energy & Battery Storage Solutions (SEBSS) can provide a comprehensive electrical data analysis for your business, Paul Reynolds on 0414 636 099.
Torie Harrison – eastAUSmilk
eastAUSmilk – accountability and growth
At the heart of every industry body is its members.
Members provide the guidance to the elected officials in undertaking their duties and policy direction for staff to advocate on the many issues that the members confront on a daily basis.
In that regard, eastAUSmilk is no different to any other organisation whose task is to safeguard the interests of their members.
Part of that democratic process is the holding each year of the Annual General Meeting where the members are provided with a 'health' check on their organisation.
They are able to ask questions of their Chairperson and seek confirmation from members of the Board. It is not just an expectation but a statutory requirement for such meetings to occur.
It is in essence the accountability that members not only want but need.
On 30 August, eastAUSmilk will be holding its AGM at the Lismore Turf Club, starting at 1pm. It will be preceded by the Annual Forum where member updates will be provided, and topical policy issues will be presented and discussed.
One of the major issues that dairy farmer members have raised with their Board members in recent times is that of biosecurity and in particular the safeguards that are in place to prevent 'foot and mouth disease' and 'lumpy skin disease' from taking hold in Australia.
We are pleased that at the Forum, representatives of QLD DAF and NSW DPI will address matters relating to biosecurity and where members can raise questions that they may have.
As well, Melissa Cameron from Dairy Australia will provide information regarding the nutritional benefits of dairy milk as against plant-based alternatives. This is topical given the continuing public discussion regarding 'truth in labelling' and its importance to dairy farmers and consumers generally.
Updates will also be provided by the CEO of dairy cooperative Norco, Michael Hampson, and the CEO of Australian Dairy Farmers, David Inall.
The Annual Forum will be from 9.30am for a 10am start and is open to members and dairy farmers generally.
Additionally, the day will also be an opportunity to mix informally with other members, dairy farmers, directors, and staff.
Through such interaction, the vitality of eastAUSmilk can be maintained and allowed to grow organically.
The Board of eastAUSmilk looks forward to welcoming you to the Annual Forum and AGM on 30 August at the Lismore Turf Club.
Shaughn Morgan, Co-CEO eastAUSmilk
A change of the guard at eastAUSmilk
It’s a sign of a healthy organisation when a quality member of the team can stand down and is readily replaced by an equally capable person. That’s exactly what has just occurred at eastAUSmilk. Gary Wenzell stood aside in June to concentrate on his farm and family commitments. I know Gary was disappointed he could not see out his full term, but these things happen in life, and he has made the right decision for his family. From the entire team at eastAUSmilk we wish him all the best and thank him for his dedicated service through the difficult times of the last couple of years.
As per the constitution the district council of Scenic Rim/Lismore was to appoint a replacement and after much interest Kay Tommerup has been appointed. I have known Kay for many years, and she will be a great addition to our team. Kay and Dave have a long history in the dairy industry as is evident by the near vintage NORCO supplier sign on their front gate. However, what has impressed me is the unique perspective Kay will bring to the board around what makes a profitable dairy farming business.
After many years of dairying in the traditional model of “it’s all about milk” Kay and Dave decided to move into Agri-tourism with open days and farm stays, and direct to customer sales. They have been immensely successful. I’m sure with many difficulties along the way but they have in the end found a pathway to profitable farming that is resistant to the variance in weather. In more recent times they have also moved into on-farm processing with the development of their own creamery and the subsequent sale of products such as cream, butter, and ice cream.
While this path is not for everyone it’s the different way of thinking backed with a successful track record that will make Kay a valuable addition to our team. I welcome you Kay and am looking forward to working with you in the interests of our dairy industry.
Matt Trace, President eastAUSmilk
Fairgo Dairy a raging success
Five years ago Shane Knuth from KAP led a campaign to get fairer prices for Queensland dairy farmers. As a result of this, the labour government funded the Fairgo Dairy project for QDO. The aim of this project was broadly around solving the problems of the dairy supply chain by specifically focusing on consumers and the retail sector given the negative impacts of $1/L milk on the dairy supply chain.
QDO utilised the funding to do a range of things. Most importantly, we ran a concerted consumer focused marketing campaign to destroy $1/L. This was an extremely successful campaign which started in late 2018 and gained tremendous consumer support and gained the attention of major media outlets Australia wide. In addition, retailers and politicians were acutely aware of what we were doing and became actively involved.
As a direct result of our campaign, $1/L milk ended in February 2019 thanks to Woolworths deciding that the time was right to lift their price to $1.10/L. A domino affect followed and all retailers matched Woolworths and milk processors were then able to lift their brand prices as well.
Fast forward three and half years to today and the retail milk price for retail brands is now $1.50-$1.60 a litre. $1/L is now buried in the past and will never return. Over the next year, further retail price increases will occur and a price of $1.70-$1.80 is expected to be the norm later this year or early next. The future is now much brighter for dairy farmers and processors around Australia.
None of this would have happened if Shane Knuth didn’t fight for a fair price for Queensland dairy farmers and if Minister Mark Furner didn’t fund the Fairgo Dairy project. All dairy farmers should be very grateful to Shane and Mark so thank you on their behalf.
Eric Danzi, co-CEO eastAUSmilk
A new Era for QLD and NSW Dairy Farmers
1 December 2021 was a significant day for dairy farmers in Queensland and NSW.
On that day, Queensland Dairyfarmers Organisation and NSW based Dairy Connect came together to form a single dairy farmer organisation representing Queensland and NSW under the united badge of eastAUSmilk.
These two industry advocacy bodies represented their members (and the dairy industry generally) over many years of public service.
Each organisation took leadership roles across a broad spectrum of policy issues, ranging from the introduction of the Dairy Mandatory Code of Conduct through to the demise of $1/L milk.
Yet like most Industry bodies, it was proving difficult to arrest the decline of dairy farms with the resulting decrease in milk production. This has become even more evident over the past decade and has been an ongoing trend since deregulation of the dairy industry in 2000.
By joining together, our two bodies could represent a greater number of dairy farmers before government and stakeholders, as well as providing an enhanced service to our dairy members.
Under the chairmanship of Matt Trace and ably supported by his Board, each representing one of the 6 District Councils, eastAUSmilk has proudly continued the strong traditions of its august past but always looking to the future.
The Board recently farewelled Gary Wenzel and he was thanked for his support of eastAUSmilk.
As with farming succession, the Board is pleased to welcome 6th generation Kerry Valley dairy farmer Kay Tommerup to the Board. Her family's dairy farm can proudly trace its history to 1874.
More information about Kay may be found at www.tommerupsdairyfarm.com.au
With an eye on the future of eastAUSmilk and dairying in Queensland and NSW, the 2022 AGM will be held on 30 August at the Lismore Turf Club. The Board and members are looking forward to visiting the Northern Rivers. Formal notification and further information will be sent to members shortly.
If you wish to become a member of our vibrant industry association, please visit www.eastausmilk.org.au where you can learn more about eastAUSmilk and become a part of our future direction.
Shaughn Morgan, co-CEO eastAUSmilk
The Future of Australian Dairy
In 2011, supermarkets decided to reduce the price of fresh milk to $1/L litre. This resulted in devaluing nutritious milk and undermining dairy farmers.
This changed in 2018 when the supermarkets, led by Woolworths, acknowledged that $1/L milk was having a negative effect upon dairy farmers and the farmgate price they were paid.
$1/L milk was at an end and the price was increased but after so many years it was still devalued.
Over these same years, the dairy industry has seen a continued reduction of dairy farms throughout Australia. In Queensland for instance there were over 3000 dairy farms in 1980, twenty years later it was approximately 600 dairy farms while today it is under 300 dairy farms.
In terms of milk production, this has also been impacted. Australia is currently producing approximately 8 billion litres compared to 12 billion litres a few years ago.
The farm gate prices that have been announced over the past months (while strong, open and transparent) are only keeping pace with the increase in input costs (for instance fertiliser, diesel and energy) that the dairy value chain, from farmers, processors to supermarkets, pay every day.
The pressure being placed on dairy farmers continues to be immense, both economically and emotionally.
More recently, farmers have experienced floods, droughts, bushfires and other natural disasters all in close proximity.
Now, on our doorstep is Foot and Mouth Disease. If it was to reach Australian shores, the immediate impact on livestock (including dairy) would be worse than disastrous.
Export sales would stop, movement of cattle would cease and (depending on the outbreak) cows would be culled and euthanised.
Decades of genetics lost in a matter of weeks. Monetary compensation would not offset these losses.
It is little wonder that dairy farmers are concerned every day about such an outbreak and the impact it would have upon their farm and the communities that support them.
Discussion has ranged from increased biosecurity measures at ports of arrival, availability of vaccinations (both here and overseas) as well as restricting travel to tourist destinations where FMD is rife.
Regardless of the issues that Aussie dairy farmers will face over the coming months, they will continue to remain resilient and strong in the face of such adversity.
While more will need to be done to ensure a long term sustainable Australian dairy industry, supermarket customers will still be able to buy Aussie produced fresh milk and dairy products from the supermarket dairy cabinet.
Shaughn Morgan, co-CEO eastAUSmilk
More Action Needed to Halt Risk of FMD
Australian livestock farmers and the industries and communities that underpin them are facing an economic and social crisis that will cripple their livestock farms should foot and mouth disease reach Australia.
The economic consequences would be devastating for livestock producers. It is estimated that our red meat exports would be immediately hit with losses valued at $15 billion and it would take years to return to markets that will be lost.
The impact on farmers and their families will be crippling. Farmers have been through devastating droughts, floods and bushfires over the past years and for many, the effects of a FMD outbreak would see them leave the industry in even greater numbers than in recent years.
This would result in a further reduction in fresh milk production, which is already falling throughout Australia.
Supermarket customers will see an immediate reduction in the availability of Australian dairy and meat products on the supermarket shelves and prices will be higher.
FMD in cows is a painful disease that causes blisters in their mouths and results in cows being euthanised. The UK outbreak in 2001 resulted in 6 million animals being killed. The impact on our industry will be far greater.
Overall, the financial impact of an uncontrolled outbreak in Australia would be approximately $80 billion over 10 years.
With FMD on Australia’s doorstep, over the past months the federal and state governments, in conjunction with peak agricultural bodies, have been discussing ways to enhance our biosecurity to prevent FMD from reaching our shores.
Campaigns have been undertaken to educate overseas travellers, particularly to tourist hotspots with FMD such as Bali.
However, this is not enough. Paying compensation to affected farmers would never replace the true value of their cows. They need to ensure that their farms are FMD safe.
It is not inevitable that FMD will arrive in Australia. Those who express this view are wrong and it must not be accepted.
Instead, much more must be done to prevent FMD from reaching our shores.
The Government must immediately reconsider imposing travel restrictions to areas that are close to Australia and which are FMD infected. This may only be needed for a short period of time but it will enable those nations to vaccinate their cows and thus control the outbreaks.
The announcement by the Federal Government to introduce 'sanitation foot mats' for incoming travellers from infected countries at all airports is welcomed but other shoes being carried by passengers must be inspected and disinfected as necessary. This is a further extension but is an inexpensive and effective solution.
We introduced harsh restrictions to halt COVID over the past years, we must do likewise to stop FMD and to protect our livestock industries. The risk is too great – more needs to be done now.
We will regret it if we do not do so.
Shaughn Morgan, co-CEO eastAUSmilk
Retail milk prices going up, but retailers and Dairy Farmers slow to move
Farmgate milk prices moved up significantly on 1 July with farmers receiving between an extra 15 and 20c/L. This was long overdue and reflects the increase in cost of production rather than giving farmers a significant profit. In future years, the price will need to continue to increase to allow farmers to make a reasonable profit or milk production will continue to decline.
At the retail level, prices started to move soon after 1 July as expected. Pauls moved very quickly to $4.00/L in both Coles and Woolworths stores and Norco also moved quickly to $4.10/L. These increases were as expected and in line with increases in farmgate prices.
However, no other retail milk prices have moved. Dairy Farmers are still at $3.55 in both Coles and Woolworths. Woolworths milk is still only $2.60 as is Coles milk. Farmers Owned is still only $3.20, which is lower than the $3.40 it was earlier in the year.
It would be expected that Dairy Farmers will lift to around $4/L but it is unclear when. Dairy Farmers owner Bega would be losing significant money selling at $3.55/L given the cost of purchasing milk off farmers has increased so significantly on 1 July.
Surely Coles and Woolworths will lift the price of their milk to at least $3.00/L but more likely $3.20/L in the coming weeks. This is not only in line with increases in farmgate prices in Queensland, but very similar increases in farmgate prices Australia wide. There is no justification for retailers leaving prices at $2.60 which is clearly a level at which retailers would be losing money. It is unclear whether retailers are in fact the ones taking this loss at present or whether the processors that package their milk are being forced to take a loss until retail prices move.
What is the impact of those brands, including Coles and Woolworths, not lifting their prices? These brands would be taking market share off those brands that have lifted prices. This is extremely bad for those negatively affected brands. Whether this is a conscious decision or not, those brands that haven’t lifted prices need to do so immediately to ensure that the dairy industry, both farmers and processors, can make a profit and remain viable.
Eric Danzi, Co-CEO eastAUSmilk
Has the dust settled on the milk supply contracts?
There has been a real frenzy of activity across Australia in the past month with all processors attempting to secure milk. Milk production is down across Australia and all processors are short of milk. There have been daily announcements re milk price increases, and this may continue in early July.
In Queensland, the last price increase announcement was by Bega (and DFMC) on 1 July although many are unaware of this. Of the 3 major processors Bega (and DFMC), Lactalis and Norco it would appear that Bega (and DFMC) are now on average paying the most for milk at over 88c/L. Lactalis is around 1c behind and Norco probably 2-3c behind on average.
However, averages mean very little and as I have mentioned continuously over the past few months every farmer coming off contract need to get income estimates with the same realistic assumptions off all processors to see who is paying the most for their farm.
There are still likely to be some farmers who change process during July. Some will exercise their 14-day cooling off period as processors continue to change prices. And some farmers will utilise the ability to supply uncontracted for 30 days before making a final decision.
So, as it stands now, how many farmers will change processor in Queensland this year? At least 10 farms will and probably closer to 15. This probably only represents about 10% of all farmers in southern Queensland who are off contract and can move processor. Although this is not insignificant, it is a disappointing outcome since many other farmers would be able to get a higher price by changing processors but for whatever reason have chosen not to do so.
If you haven’t checked your price with other processors, please do so today. Even if you have signed a contract, if it was within the last 14 days you can get out of that contract to sign with someone else paying a higher price, so it is not too late.
Eric Danzi, Co-CEO eastAUSmilk
Installing a water chiller and solar pays off for dairy
A dairy in the Darling Downs region, milking 280 cows, has implemented a photovoltaic (PV) system with load shifting through chilling water management opportunity based on the energy audit report the farm received through the Energy Savers Plus Program Extension. Through the program the business site received a dairy shed energy audit carried out by AgVet Energy and a further assessment carried out by Websters Group followed by an electrical site analysis performed by Solar Energy & Battery Storage Solutions (SEBSS) all engaged by eastAUSmilk.
The goal of the business was to reduce electricity costs by firstly lowering supply from the grid and secondly, with the reduced grid supply, transitioning from the demand tariff to a consumption tariff such as Tariff 20.
Implementing the solar system along with water chilling allows for increased solar utilisation by the business as large portions of the business’ energy use occurs outside of daylight hours with milking. Excess solar energy is used during the day to chill water and then the cold water is used through a plate cooler to reduce the temperature of milk before it reaches the vat offsetting energy use by the refrigeration system.
Monitoring the farm energy use from July to October 2021 an average PV energy utilisation of 67% was achieved.
The total load was 319 kWh/day with an average 210 kWh/day being supplied by the grid. With a grid supply charge of 29.46 c/kWh and a 109 kWh being offset by PV the system conservatively achieves an annual electricity bill saving of more than $11,700.
Additionally, on average 53.92kWh were exported daily at a feed in rate of 6.581 c/kWh the PV system is generating export income of over $1,200.
The total expenditure invested by the business was about $76,000. With over $12,900 in annual savings from reduced grid supply and income generated from solar PV export the calculated payback period of this investment is 5.9 years with a return on investment of 17%.
Implementing the 30kW PV system the grid supply has been under 272 kWh/day. Four consecutive months of this reduced grid supply makes the business eligible for a consumption only Tariff such as T20. This will provide the business further annual savings reducing the payback period and increasing the returning on investment.
Solar Energy & Battery Storage Solutions can provide a comprehensive electrical data analysis for your business, Paul Reynolds on 0414 636 099.
Torie Harrison – eastAUSmilk Project Officer
Thanks Gary and Torie
In the past two weeks eastAUSmilk has farewelled board member Gary Wenzel and staff member Torie Harrison. Gary was on the board for 2 ½ years and Torie left last week after more than 4 years with eastAUSmilk and QDO.
Gary has been a very considered and knowledgeable board member and relied on this when making decisions rather than be swayed by politics. Gary has a depth of experience in dairy farming, RDE, transport and water, given his various roles in the industry historically. Gary has always been focused on grass roots dairy farmers given his extensive networks in the industry.
Quite an unassuming dairy farmer Gary is, but he and his wife Karen run an impressive operation. Without any fanfare, they achieve very good milk production per cow in a low-cost way for their TMR system in often very trying conditions. I hope the conditions aren’t so wet in the coming months and the price increases to a sustainable level.
Torie is returning to work on her family’s dairy farm in Kilcoy. It has been a pleasure to work with Torie over the past 4 years. Torie has always had a strong knowledge of dairy farming and a real passion for the dairy industry. She has been very focussed on engaging with dairy farmers and helping them as much as she can.
Over the past 4 years Torie would have learnt a lot and built very strong networks within the dairy industry. This will help her immensely on the dairy farm and I am sure she will use this knowledge and networks to move the dairy farm forward over the coming years.
Best of luck to both Gary and Torie in the future. I’m sure you won’t lose contact with eastAUSmilk.
We will always be grateful for all you have done for dairy farmers and eastAUSmilk. Thankyou both.
Eric Danzi – eastAUSmilk Co-CEO