Littleproud, Collins fail to outline vision for Australian dairy
Dairy leaders are calling for federal policy-setters to outline their vision for the sector, but none have been forthcoming.
Australia’s dairy industry has been overlooked by the two politicians aiming to set the nation’s agricultural agenda, as the 2022 election campaign enters the final fortnight.
Federal Agriculture Minister David Littleproud and opposition agriculture spokeswoman Julie Collins were asked by The Weekly Times to outline their plans for dairy over the next three years. Both failed to respond.
United Dairyfarmers of Victoria vice president Mark Billing said the lack of vision from Canberra over dairy was “just not good enough”.
“There was a lot of goodwill for dairy through the past two years of Covid. We kept the milk flowing from the farm to the factory to the supermarket, despite all the challenges,” he said.
“Australians really took notice of the value of not just dairy, but agriculture as a whole and take these things less for granted than perhaps they once did.”
Mr Billing identified increased input costs and labour shortages as key concerns for the sector, which will necessitate higher retail prices.
He said biosecurity and support for flooded farms in northern NSW were also simple funding announcements were a federal government can make a real difference.
Prime Minister Scott Morrison inspected Norco’s Lismore factory shortly after the northern NSW floods in March but follow up funding is yet to be announced by the PM nor Opposition Leader Anthony Albanese.
“We see a lot of attention with bushfires but the floods have really hit a lot of farmers hard. They shouldn’t be forgotten about just because they’re out of the news,” Mr Billing said.
Mr Littleproud has previously promoted the benefits of the mandatory dairy code of conduct but offered little new Coalition policy for the sector, which has faced more than a quarter of its farmers leave the sector in the past five years.
Ms Collins was asked last month whether Labor planned to re-regulate the dairy industry.
“We’ve been talking to dairy farmers, and we’ll be making announcements about what we want to do in the coming weeks.” Ms Collins told ABC radio in early April.
No announcement has occurred in the past six weeks since the interview.
David Littleproud calls for Aldi, Coles, Woolworths to explain farm cost pressures
David Littleproud is supporting calls by Victorian dairy leader Paul Mumford for supermarkets to raise prices and explain the reasons why.
Supermarkets need to raise the price of milk and explain the reasons why via a major marketing campaign, according to the Federal Agriculture Minister.
David Littleproud has backed calls by United Dairyfarmers of Victoria president Paul Mumford for the nation’s big three supermarkets to explain why dairy prices need to rise via in-house marketing.
The price of generic milk now sits at $1.30 a litre at Aldi, Coles and Woolworths but the UDV and other dairy groups say an immediate rise is necessary with fertiliser costs quadrupling in the past year.
“I think the supermarkets owe it to the industry — they’re the ones who devalued the industry,” Mr Littleproud said.
“What we’ve only recently announced is the $1m in transparency in pricing to bring that to the public attention and give power back to dairy farmers around volumes and prices and fat content … but the supermarkets have a lot to make up for, the way they devalued the industry.”
Mr Mumford last week told The Weekly Times that prices needed to rise and a mass marketing drive by the supermarkets should be initiated to explain the reasons why.
“It’s a case of leading the witness. If milk stays at $1.30 a litre, then the consumer thinks things are OK. Supermarkets need to do a lot more to explain why prices need to rise,” Mr Mumford said.
The Agriculture Minister said it wasn’t just dairy under inflationary duress and called for the consumer watchdog to do more to keep retailers accountable.
“It should be shown at the checkout, supermarkets are making farmers absorb it,” Mr Littleproud said.
“The ACCC needs to lift their game, I think they’ve been asleep at the wheel on this. Apple producers are very concerned about the input costs not being reflected. And the behaviour of the supermarkets was not allowing them an uplift in price despite the input costs, farmers don’t want charity, they want a fair price.”
A Coles spokeswoman said: “Coles contracts directly with Australian dairy farmers to purchase milk for Coles Brand fresh white milk in most Australian states, offering long-term contracts that provide farmers with certainty to plan for the future.
“The price Coles pays farmers for their milk is determined independently to the retail shelf price.”
Source: Alex Sinnott and Alexandra Laskie, The Weekly Times, 26 April 2022
Littleproud lays blame for massive new drop in dairy farm numbers
Supermarkets, unions, drought and poor advocacy are all to blame for a massive drop in dairy farm numbers laid bare by last week's levy poll figures, Agriculture Minister David Littleproud says.
The dairy levy poll data showed the number of Australian dairy farms entitled to vote was just 4401, a 13 per cent fall in two years from the 5013 farms in 2019/20.
Mr Littleproud said drought had hit the industry hard and many farmers had taken the opportunity presented by high land prices to leave the industry but he said supermarkets were also responsible.
"I think that supermarkets also played a significant role in that, in basically devaluing the industry," he said, referring to the dollar-a-litre milk war.
"There were big structural changes that need to take place and it doesn't surprise me, but it concerns me deeply," Mr Littleproud said.
While he said dollar-a-litre milk had been "broken, the way forward for the industry required "harmony" and "clear direction".
"I don't think supermarkets, not only on dairy but on a number commodities, are covering themselves in glory and I think that's one of the things that we want to look at, particularly the Nationals, and we'll be bringing our Coalition partners with us on this one, is that there needs to be better reform around how supermarkets deal with perishable goods," Mr Littleproud said.
There would be greater market transparency, he said, that would mean farmers had the same information about production levels and costs as supermarkets, so they could negotiate on a more level playing field.
The Australian Milk Price Initiative, which launched a month ago and was given $500,000 in funding after last election, was an example of a tool designed to increase transparency.
The Minister said the next phase would be to strengthen laws surrounding supermarket negotiations with farmers.
At the moment, he said, the penalties for breaches were just "a cost of doing business" for supermarkets.
"We need to shift to make sure those regulatory guardrails are clear to them but, if they step outside it, there's a penalty and it should be a sizable penalty so they know that, if they breach, it's not just writing out a check for $60-odd thousand dollars, they actually feel it with some financial might," Mr Littleproud said.
On the question of "harmony", Mr Littleproud described Australia's dairy advocacy as "fragmented".
"If you've got fragmented representative bodies, it makes it difficult to know actually what producers really want and that then means that it's difficult for a minister to make a determination," he said.
That fragmentation of dairy advocacy had been obvious, for example, when it came to developing the mandatory code, Mr Littleproud said.
"It was very difficult when you had different forces articulating different things to try and get it all into place," he said.
"Ultimately, what it means is that it either delays any action being taken or action being taken at all."
There had been a great deal of division in the lead up to the dairy levy poll vote, with peak national body Australian Dairy Farmers taking the unprecedented decision to defy its own national council and recommend no increase in the levy.
Mr Littleproud wouldn't be drawn on whether he felt the levy poll was a vote of confidence in Dairy Australia.
"Look, I don't think I want to get into the minutiae of politics of the dairy industry, that's for the members to decide," he said.
"But obviously, in any industry, it's an important principle that levy payers get to determine the percentage, the amount that they put out there and that's a principle but I'll continue to protect regardless of who and what industry body is there."
He would not say whether dairy farmers should have been given the option of a decrease in the levy, or whether the committee that decided on the voting options was truly representative of grass roots farmers.
Instead, Mr Littleproud said there was a mechanism that allowed levy payers to challenge the committee and that angst surrounding producer levies was common across most industries.
He said he had already been approached about having processors pay levies alongside farmers to help fund Dairy Australia, and was happy to explore that possibility if it was supported by industry.
Asked whether he would only act with the backing of peak processor body, the Australian Dairy Products Federation, Mr Littleproud said he needed to investigate further.
"That's the legalities that I'd have to work through but, if in principle that's where industry wants to go, then I'm prepared to explore what legal options I have," he said.
"I'm not afraid to do that if that's where industry thinks that should go, and if they can articulate a reason for that, I'm prepared to explore it."
It's the shortage of labour, however, that has united dairy advocacy groups around Australia.
The Morrison government announced the Ag Visa in September, promising there would be workers on farm by Christmas but only Vietnam has so far agreed to allow its citizens to participate.
Mr Littleproud laid the blame at the feet of the Australian Workers Union.
"We've only been able to get the Vietnam to sign up to the visa as the first country because the AWU demonized farmers and said that they'd exploit their workers so they went to embassies and ambassadors and said to them not to send their citizens because Australian farmers would exploit them," he said.
Going for growth in the fertiliser industry
The Australian Government’s Northern Australia Infrastructure Facility (NAIF) has committed $255 million for critical infrastructure supporting the Perdaman Urea Project in Western Australia.
The $4.3 billion project located 20 kilometres north-west of Karratha will convert Australian gas into approximately two million tonnes of urea per year.
Minister for Agriculture and Northern Australia, David Littleproud MP said the NAIF commitment will help kickstart this new multi-billion-dollar industry.
“Australia currently imports around 2.4 million tonnes a year of urea for agricultural use, and the Perdaman project will have the capacity to meet 96 per cent of that volume,” Minister Littleproud said.
“The NAIF’s investment will provide farmers’ access to locally manufactured fertiliser, securing our agricultural production and boosting our exports.”
Minister for Defence Industry, Minister for Science and Technology, Melissa Price MP said the Perdaman plant is expected to provide an $8.5 billion public benefit to Northern Australia.
“This investment is great news for Karratha, Dampier and the broader region, this project will support a peak of 2,490 construction and operations jobs over its 40-year life,” Ms Price said.
Special Envoy for Northern Australia, Senator Susan McDonald said the NAIF has now made financing commitments of close to $3.2 billion to projects across Northern Australia, with around $1.3 billion of that for Western Australian projects.
“Our investment in Western Australian infrastructure projects is expected to inject $12.9 billion into the economy and create more than 4,380 jobs,” Senator McDonald said.
NAIF Acting CEO Amanda Copping said the NAIF is committed to supporting projects that bring economic growth to northern Australia.
“We are pleased that our latest two loans will support the diversification of the Pilbara economy by supporting significant domestic manufacturing and creating thousands of regional jobs,” Ms Copping said.
The NAIF commitment is being delivered through two separate loans:
· $160 million to the Pilbara Ports Authority for a new multi-user wharf and facilities at the Port of Dampier to facilitate exports, and
· $95 million to the Western Australia Water Corporation for the expansion of the Burrup seawater supply and brine disposal scheme that will also service the operation of Perdaman Urea Plant.
The Perdaman Urea Plant is considered transformational for Western Australia, having been awarded Major Project Status by both the Australian and Western Australian governments.