Australian Dairy Levy Poll result: Voters say no to levy hike
5000 dairy farmers have said no to paying higher levies to Dairy Australia. See how farmers voted by state.
An overwhelming majority of dairy farmers have voted against any increase in the levy they pay their peak research and development corporation – Dairy Australia.
More than 72 per cent of valid voters voted to keep the levy at its current level, with about 16 per cent of voters opting for the recommended 20 per cent increase.
Dairy Levy Poll - Overall result
The levy has remained at the same rate since 2012, with farmers paying 2.8683 cents per kilogram of milk fat and 6.9914 cents per kilogram of protein.
A 20 per cent rise was recommended by the Levy Poll Advisory Committee (LPAC) earlier this year but the low to negligible contribution by processors has generated controversy.
In the end the Australian Dairy Farmers Board urged the nation's 5000 farmers not support any increase in the levy, given dairy processing giants – such as Fonterra, Bega and Saputo – refused to contribute, despite enjoying the benefits of the R&D body’s $10 million investment in post farmgate manufacturing research, market access and development.
Dairy Australia managing director David Nation said: “we value and appreciate every dollar of the dairy levy, and we will continue to invest it in ways that deliver tangible benefits to farmers.
“It was also pleasing to see 36 per cent (of primary voters were cast) for an increase in levy, indicating support for the key areas identified for continuing investment – labour, regional services, climate and policy development.
“We will need to consider how we address these key areas and now work to prioritise investment and services with these areas in mind, along with our current investment mix.”
Dairy farmers were denied the right to vote for a cut in the levy rate in the poll.
In February, United Dairyfarmers of Victoria president Paul Mumford gave “an ultimatum to dairy processors to stump up or piss off” – out of Dairy Australia.
Yesterday, Fonterra Australia managing director René Dedoncker said his organisation was willing to make a proportionate financial contribution to DA.
“Fonterra recognises the value of processors and farmers working together and the mutually beneficial outcomes that can be achieved by doing so,” he said.
“We support the notion of processors making meaningful contributions – both financial and time – to ensure that Dairy Australia has the resources it needs to address the industry’s priority areas, and we commit to making proportionate financial contributions.”
Dairy Levy Poll result – by state
Source: Alex Sinnott and Peter Hunt, The Weekly Times, 6 April 2022
Dairy farmers demand Fonterra, Saputo and others pay up or leave DA
Farmers have had enough, warning processors to pay their share of Dairy Australia’s research, development and marketing costs.
Farmers are mounting a campaign to oust dairy giants Fonterra, Saputo and other processors from the industry’s peak research, development and marketing body, unless they pay their fair share of Dairy Australia’s costs.
United Dairyfarmers of Victoria president Paul Mumford said the nation’s largest dairy state was backing “an ultimatum to dairy processors to stump up or piss off” – out of DA.
Currently, dairy processors contribute virtually nothing to Dairy Australia, but are granted a seat on its board and its selection committee, are listed as Group B shareholders and were even represented on the advisory committee that recommended lifting farmers’ DA levy contributions by 20 per cent, from $32 million to more than $38m.
Mr Mumford said the UDV had already agreed to back the national council of the Australian Dairy Farmers lobby – representing Victoria, Tasmania, South Australia, NSW, Queensland and Western Australian – to demand processors contribute at least $5 million to DA, given its post farmgate work was worth close to $10 million.
“Over the last 20 years dairy farmers and tax payers have contributed close to $1 billion to Dairy Australia, while processors have effectively contributed nothing,” he said.
Forcing processors out of DA would require amendments to its constitution at a general meeting, which could be called by 100 farmer members.
Farmers say the big question is will the national council and ADF follow through and act on an ultimatum if processors refuse to contribute.
ADF has been calling on processors to contribute to DA since 2019, when it lodged a submission to the Federal Government’s inquiry into modernising research and development corporations.
At the time ADF stated DA’s post farmgate program was valued at $9.7m and it believed “government should mandate processors to pay levies for post farm gate programs delivered by their RDC (Dairy Australia)”, highlighting that Australia’s red meat processors already faced a mandatory levy.
In May last year the Australian Dairy Products Federation, representing processors, said it was engaged in a due diligence project with DA to understand the value of its work to Fonterra, Saputo and others.
But as of last week ADPF stated it was still working through their approach and it was not the right time to discuss any processor contribution.