The Demise of the Australian Dairy Industry
I am not trying to milk it or anything, but the truth is the dairy industry is in crisis.
The sound of Dad closing the front door at 4:00am wasn’t unusual in my household. It was a reality, an annoying one, but one I soon realised was something iconic.
The unrelenting hours spent milking the 400 cows twice a day, were physically tiring as supermarkets have maintained the same unsustainable price of milk for the past 20 years. Fancy just $1.20 for a litre of milk- it is cheaper than water!
My family has been working in the dairy industry for 4 generations now, so I am aware of the early mornings, long long days, freezing fingers and sick animals. But nothing prepared us for how tough it was to stay afloat once the price battles. In 1980, 40 years ago there were over 200 dairies in the Southern Highlands now there are only 8.
It saddens my family that the milk industry is in demise, as we had good farming practices and suitable infrastructure’s in place, but not being paid a fair price to continue a viable business, we had to close.
The supermarket wars had a direct impact on our whole livelihood as we were forced out simply because of the price of milk. This wasn’t a choice my Mum and Dad wanted to make. Their continuous devotion and love of our farm is known throughout the community
Growing up, I was fortunate enough to have the luxury of having fresh milk straight from the vat, every day on my Weet-Bix and in my milo. I would race over to the dairy before school each morning to fill the 5L billy to the absolute brim, to bring back to the house.
I’d race over hoping that I’d get there before the milk truck had come and drained our vats, because how embarrassing to live on a dairy farm and when visitors arrived to find that the kitchen fridge had no milk to make them a cup of tea.
What I loved most about the milk that came back in the billy was the 2cm of cream that would rise to the top and the satisfaction of dipping my spoon in and putting a dollop straight in my mouth, and I can tell you there’s nothing like truly fresh cream, but unfortunately that’s just a memory now.
Leaving dairy farmers unsupported, is that fair to all concerned?
The dairy industry is struggling to survive. Despite high demand for supply, there is a continuous mass exodus from the industry because of a combination of; skyrocketing feed prices, water costs, inconsistent milk prices and dry conditions.
Each one of these by itself is hard to battle, but combined together at the same time, is too much for too many people to cope and continue. Let me give you some background information, in 1980 there were 22,000 dairy farms in Australia and today there are fewer than 6,000, this has resulted in the lowest production of milk in 20 years.
The industry has been proactive in trying to defend itself and those who work within it but It took eight years for the dairy industry to persuade just one supermarket to increase the price that was barely covering costs. The problem is supermarkets are commonly signing contracts with processors to supply their stores with house brands in individual states.
The processor buys the milk from the farmers then processes, packages and delivers it to the supermarkets along with their own labelled brands. Well-known brands include Dairy farmers, Pauls and Devondale. We supplied our milk to Parmalat also known as Pauls; we averaged a low 55 cents per litre. So Coles and Woolworths could sell a litre of milk for $1.20.
The price of $1.20 still doesn't make sense to me, as you can buy water at $3 a litre, soft drink at $4 a litre and Gatorade at $5 a litre." So when I am asked “Is it fair to all concerned? I can confidently say a firm, first-hand experience, No.
Meanwhile, Woolworths and Coles are doubling their retail profits and making a substantial income. I have spoken to many people who are willing to pay a higher price for milk, in support of our local communities.
Dairy farmers across Australia collectively say that costs are far higher than their income. The work that goes into 1 litre of milk is far more than simply just milking a cow. It includes maintaining the correct soil and pasture types and undertaking pasture improvement programs.
The pressure of the drought throughout Australia has impacted the dairies running costs significantly, particularly supplementary feeding, which has a real effect on a farmers’ bottom line.
The crisis surrounding the milk industry cannot build good will between the farmer and the retailer because the farmer is being taken advantage of. Good will is defined as “friendly, helpful, or supportive feelings or attitude”.
I don’t believe and I’m sure you will agree with me that $1 milk is not valuing the efforts of the farmer and it is not even reimbursing them for the true cost of production.
It is nearly too late for a solution to curb the demise of the Australia dairy industry. However, a possible solution could include; forming a farmer’s co-op where the general public could buy and have access to fresh milk without a middleman.
This would be beneficial to all concerned. As Farmers would be able to set a fair price for their product keeping it at a consistent price consumer would be happy with, because the middleman wouldn’t be taking the ‘’cream’’ like they are currently doing.
The greed from certain supermarkets selling $1 milk has given them benefits but not the farmer or ultimately our communities.
It was an emotional day when the day the cows left on the truck. Generations of our own breeding, routine and passion for the industry lost, simply because of the price set by the supermarkets for ‘our’ milk.
So I may no longer be able to dip my spoon in the billy for the cream but if nothing is done at all then very soon you won’t be able to reach for Australian milk in the fridge to make your cup of tea or pore on you breakfast cereal. As without any dairy farmer there just won’t be any Australian milk.
Mairi Menzies, Frensham School
